Introduction
Canada is increasingly being called upon to play a greater role in the regulation of the activities of its mining corporations in developing countries where regulatory and accountability mechanisms are weak. These calls are due to the growing number of Canadian mining corporations caught at the centre of alarming allegations related to egregious human and environmental rights abuses and corruption around the world. Footnote 1 The calls are represented, perhaps most pointedly, by a growing number of civil lawsuits brought by victims of those abuses in Canadian courts, seeking accountability and justice against Canadian corporations. At least eight of such lawsuits have been filed in Canada, four of which were dismissed based on pre-trial challenges. Footnote 2 Two survived pre-trial challenge, Footnote 3 while another, which was previously dismissed by the British Columbia Supreme Court was recently restored by the British Columbia Court of Appeal. Footnote 4 Yet another, which related to the recognition and enforcement of a judgment obtained in a foreign court, survived a jurisdictional challenge. Footnote 5
Two main factors are driving these victims to the judicial mechanisms available in the home states of the corporations: (1) the absence or inadequacy of accountability mechanisms in the developing countries that are home to the victims and (2) the need to find a legal forum where the corporations can be called to account for their actions. Footnote 6 It has been observed that in many cases mining corporations take advantage of the fragile economic and political atmosphere in their host developing countries to secure the enactment of legal and regulatory frameworks that are not only favourable to their business interests but that also, in many cases, prevent the investigation of allegations of abuses related to their projects. Footnote 7 A 2014 report prepared for the Inter-American Commission on Human Rights (IACHR) on the impact of Canadian mining in Latin America stated that “[t]he situation of victims whose human rights have been violated as a result of extractive projects is generally met with impunity and the lack of access to justice at all levels.” Footnote 8 In July 2015, the United Nations Human Rights Committee expressed similar concern over “allegations of human rights abuses by Canadian [mining] companies operating abroad … and about the inaccessibility to remedies by victims of such violations.” Footnote 9 A coalition of civil society organizations submitted a report to the UN Committee on the Elimination of Discrimination Against Women in October 2016, lamenting that access to justice for victims of human rights abuses (including abuses against women) by Canadian corporations operating abroad “remains elusive” in Canadian courts. Footnote 10 The report noted that while “a handful of civil actions” had been filed in Canada, “no case has resulted in remedies for the victims” due to a number of obstacles, such as the application of the doctrine of forum non conveniens and high costs of litigation (including costs awarded against the losing party). Footnote 11 The aforementioned IACHR report recommended the creation of “effective access to justice before the Canadian courts, so that victims of human rights violations by Canadian companies abroad can obtain truth, justice, and comprehensive reparations.” Footnote 12 The failure of civil lawsuits in Canada to serve as a forum where justice can be served raises the question of what other options might be considered. Can extraterritorial criminal prosecution come to the rescue?
Transnational civil litigation has become an important means of enforcing international human rights law, particularly in the United States via the Alien Tort Statute. Footnote 13 On the criminal front, however, although countries like Spain and Belgium were once famous for applying their criminal statutes to criminal activities occurring outside their territories (sometimes asserting universal criminal jurisdiction over conduct that had no direct link with their territories), Footnote 14 to this date no country is reputed for applying such statutes to extraterritorial corporate criminal activity except in relation to the corruption of foreign public officials. Footnote 15 The scholarship on the use of criminal prosecution to regulate extraterritorial corporate conduct in the human and environmental rights sphere has suffered from this lack of state interest in the matter. Although legal experts diverge on whether international law requires home states to help prevent human rights abuses abroad by transnational corporate actors, there seems to be greater consensus that there is nothing in principle prohibiting states from doing so where a recognized domestic jurisdictional basis exists and the actions of the home state do not interfere in the internal affairs of other states. Footnote 16 It has been suggested that, while the Rome Statute of the International Criminal Court (Rome Statute) does not provide for jurisdiction over corporations, national courts may be bolstered by the legal system created under the statute to begin to prosecute corporations for international crimes. Footnote 17
The purpose of this article is to analyze the legal framework for extraterritorial criminal prosecution in Canada with a view to seeing how corporate criminal prosecution could be utilized to ensure the accountability of Canadian mining corporations involved in human and environmental rights abuses in developing countries. One advantage criminal prosecution could have over civil litigation is that a criminal trial is not subject to the type of pretrial challenges that civil litigation is prone to. For instance, the doctrine of forum non conveniens, which is the major ground for the dismissal of the civil suits mentioned above, Footnote 18 is not applicable in criminal cases. One major problem associated with criminal prosecution, however, is that it is at the discretion of the Crown whether or not to prosecute any particular suspect. However, with respect to corruption, the Canadian government enacted the Corruption of Foreign Public Officials Act to criminalize and render prosecutable in Canada Canadian corporations, citizens, and permanent residents involved in the bribery of foreign public officials overseas. Footnote 19 There is no apparent legal impediment to the Canadian government enacting similar legislation or using already existing doctrines and criminal statutes to address the criminal conduct of Canadian corporations relating to human and environmental rights abuses in the course of their operations abroad. The only apparent impediment is the absence of the volition to do so. Footnote 20
The discussion begins with a description of the nature of Canadian extractive companies’ involvement in human and environmental rights abuses in developing countries. Thereafter, the article analyzes the source of parliamentary authority in Canada to pass legislation criminalizing extraterritorial conduct. This is followed by an analysis of the jurisdictional bases for criminal prosecution in Canada, with a view to highlighting the scope of extraterritorial criminal jurisdiction allowed under Canadian law. The analysis is based on the jurisprudence developed around the “real and substantial link” test enunciated by the Supreme Court of Canada (SCC) in 1985 in R. v Libman, Footnote 21 the Crimes against Humanity and War Crimes Act (CAHWC Act), Footnote 22 and the Canadian Criminal Code. Footnote 23 The article then considers the implications for international comity of the exercise of extraterritorial criminal jurisdiction in Canada. The analysis is terminated with a consideration of the doctrine of corporate criminal liability as currently understood and applied in Canada. It argues that legislative amendments of the doctrine that occurred in 2003 have significant implications for the assumption of extraterritorial criminal jurisdiction over Canadian corporations. The last section of the article concludes the discussion. Footnote 24
Canadian Extractive Companies and Human and Environmental Rights Abuses in Developing Countries
In 2006, the United Nations Secretary-General’s Special Representative on Business and Human Rights, John Ruggie, reported that the extractive industry accounted for about two-thirds of reported human rights abuses in developing countries. Footnote 25 Although Canada is recognized as a global leader in its quality of governance, Canadian extractive corporations operating overseas have been implicated in many of these abuses. Footnote 26 In March 2013, for instance, Columbians swarmed the streets of Bucaramanga to protest the environmental impacts of the activities of Canadian mining company Eco Oro Minerals Corp. Footnote 27 There have been allegations of gang rape implicating Barrick Gold in Tanzania and Papua New Guinea (PNG). Footnote 28 In September 2015, the Akali Tange Association of PNG submitted 256 names of victims who had been shot dead, injured, and/or raped by security personnel guarding Barrick Gold’s Porgera joint venture mine. Footnote 29 Talisman’s alleged role in the ethnic cleansing that occurred in Sudan in the 1990s is perhaps the most notorious. Footnote 30
There are several reasons why regulation exclusively by host state developing countries is inadequate to police transnational corporations (TNCs). The defendant is usually a large, well-resourced TNC. The host jurisdiction is either unable or unwilling to investigate and prosecute the alleged abuses. TNCs’ operations are characterized by a complex network of subsidiaries and a large number of independent contractors. Footnote 31 As Patrick Macklem describes it, the nature and grasp of the operations of TNCs are such that “they often operate in jurisdictions in which human rights violations occur, obtain benefits from subsidized arrangements with governments that commit human rights violations, provide goods and services that result in human rights violations, or organize in ways that violate the rights of workers.” Footnote 32 Sometimes, TNCs operate in countries that are “fissured by civil war” and sometimes fall “prey to one faction or another.” Footnote 33 In other instances, their operations generate opposition that sparks violent unrest. When violence erupts, they have responded by “tapping directly into the military expertise and firepower of both state and private armies.” Footnote 34 In yet other instances, they may provide goods and services that increase a regime’s repressive capability or can be a source of revenue to a repressive regime. Footnote 35
To date, Canada’s responses to abuses by its corporations have been largely all talk and no concrete action towards legal accountability, evincing a strong preference for soft measures. Footnote 36 Attempts by opposition parliamentarians to introduce accountability legislation to address the problems have proved vain. Footnote 37 Yet the need for accountability is readily apparent, for, as Naomi Roht-Arriaza puts it, “[a]ccountability [for human rights abuses] is now routinely demanded ... in part due to a recognition that the seeds of future violations are sown, in part, in the failure to come to terms with past cycles of violations.” Footnote 38 Canada’s reputation as a successful pluralistic and democratic society where the rule of law reigns and a champion of human rights and dignity for all gives it a strong incentive to take proactive action to regulate the activities of its corporations abroad affecting human rights and to provide a mechanism for accountability where violations occur. Footnote 39
The Source of Parliamentary Power to Act Extraterritorially
Consistent with federalism, legislative power in Canada is divided between the federal government and the federating provinces and territories. The Canadian Constitution Act 1867 (that is, the British North America Act, as it was originally called) makes no reference to the power of the federal Parliament to enact extraterritorial legislation. Footnote 40 The closest it goes is contained in section 132 where it states that Parliament “shall have all the Powers necessary or proper for performing the Obligations of Canada ... towards Foreign Countries, arising under Treaties between the [British] Empire and such Foreign Countries.” However, the 1931 Statute of Westminster, enacted for Canada (and other British dominions) by the British Parliament, does make such a reference. Footnote 41 Section 3 states quite explicitly: “[T]he Parliament of a Dominion has full power to make laws having extraterritorial operation.” Footnote 42 Most of the early cases before the enactment of this statute held that criminal jurisdiction was confined to Canadian territory. Footnote 43 Some early constitutional cases before the Act, however, seemed to suggest that Parliament could enact such laws. Footnote 44 The only limitation the constitutional cases placed on the federal Parliament, Symon Zucker argued in 1975, was that in the exercise of this power, the federal Parliament ought not to intrude in the powers reserved for the provinces. Footnote 45 Although one notable SCC decision tried to cast doubt over Parliament’s competence to legislate extraterritorially, later cases seemed to have re-affirmed it. Footnote 46 One case viewed as such authority was The Ship “North” v The King. Footnote 47 An American vessel was found fishing illegally within Canadian territorial waters. The question was whether a lawful seizure could be made on the high seas for a crime committed within Canadian territorial waters. In deciding the case, the court applied the international legal doctrine of “hot pursuit,” which allows pursuit beyond a state’s territory if the pursuit began lawfully within the state’s territory. The court referred to the powers of the federal government over the seacoast and inland fisheries.
The Ship “North” is a weak authority on which to build the proposition that Parliament could legislate extraterritorially. The facts of the case do not provide an apt example of extraterritorial application of domestic law. The illegal fishing took place within Canada’s territorial waters. The only extraterritorial element in the case was the arrest of the ship, which took place outside Canada’s territorial waters. This speaks more to enforcement jurisdiction than to legislative or to adjudicatory jurisdiction. And the extraterritorial enforcement was justified on the basis of the international legal doctrine of “hot pursuit,” not on any inherent powers or domestic legislative grant. Besides, extraterritoriality was not directly argued by the parties, although the court made reference to the wide powers Parliament had over the seacoast and inland fisheries. Footnote 48 The case is better seen as an early authority for the application of international law by Canadian courts.
Croft v Dunphy provides a better basis — yet limited, for reasons outlined shortly — for the view that Parliament had a general power to pass extraterritorial legislation before 1931. Footnote 49 Pursuant to powers conferred on it by the 1927 Customs Act, Canadian Customs seized the schooner Dorothy M Smart about eleven miles off the coast of Nova Scotia. Footnote 50 The defendants argued that the seizure was illegal because the legislation authorizing it was ultra vires the Parliament of Canada to pass by virtue of its extraterritorial effect. The Privy Council wrote:
[T]he Parliament of Canada is not under any disability [to legislate extraterritorially]. Once it is found that a particular topic of legislation is among those upon which the Dominion Parliament may competently legislate as being for the peace, order and good government of Canada or as being one of the specific subjects enumerated in s. 91 of the [British North America] Act, their Lordships see no reason to restrict the permitted scope of such legislation by any other consideration than is applicable to the legislation of a full Sovereign State. Footnote 51
Although Parliament had passed the Statute of Westminster before the Privy Council decided this case, the Council did not rely on the Statute of Westminster but, instead, found sufficient basis outside it to hold that Parliament had authority to pass extraterritorial laws. But Croft provides only a limited basis for the assertion that Parliament could pass extraterritorial laws before the Statute of Westminster for two reasons. First, it was based on a state’s competence in international law to pass laws that operated beyond the traditional three-mile limit in the seaward belt: “But whatever be the limits of territorial waters in the international sense, it has long been recognized that for certain purposes, notably those of police, revenue, public health and fisheries, a State may enact laws affecting the seas surrounding its coasts to a distance seaward which exceeds the ordinary limits of its territory.” Footnote 52 Thus, the sphere of activity where Parliament could pass such laws was specific.
Second, the Privy Council relied on the English practice of passing customs legislation that operated beyond the territorial waters and presumed that this power was conferred on Canada in 1867 by necessary implication:
It will thus be seen that, when the Imperial Parliament in 1867 conferred upon the Parliament of Canada full power to legislate regarding customs, it had long been the practice to include in Imperial statutes relating to this branch of law executive provisions to take effect outside ordinary territorial limits ... In these circumstances it is difficult to conceive that the Imperial Parliament in bestowing plenary powers on the Dominion Parliament to legislate in relation to customs should have withheld from it the power to enact provisions similar in scope to those which had long been an integral part of Imperial customs legislation and which presumably were regarded as necessary to its efficacy. Footnote 53
Parliament’s power to legislate extraterritorially was thus confined to customs matters relating to the territorial sea. It may be said that before the Statute of Westminster, there was no strong basis, outside matters appurtenant to the seacoast, to say that the Canadian Parliament was competent to legislate extraterritorially. With the Statute of Westminster, however, the question was settled beyond doubt that Parliament could act extraterritorially. This has been confirmed again and again by the SCC. Footnote 54 Yet the presumption against extraterritoriality remains the primary rule in Canadian criminal law. Judicial authority indicates that express and clear language is required to upset this presumption, or the inference can be drawn by necessary implication. In Society of Composers, Authors & Music Publishers of Canada v Canadian Association of Internet Providers, Justice Ian Binnie stated that
[w]hile the Parliament of Canada, unlike the legislatures of the Provinces, has the legislative competence to enact laws having extraterritorial effect, it is presumed not to intend to do so, in the absence of clear words or necessary implication to the contrary. This is because “[i]n our modern world of easy travel and with the emergence of a global economic order, chaotic situations would result if the principle of territorial jurisdiction were not at least generally respected.” Footnote 55
Still, as will be seen later, this presumption has been considerably weakened by the decision in Libman and with the increasing number of legislative provisions in Canada granting extraterritorial criminal jurisdiction. Footnote 56 Yet it remains accurate to say that extraterritoriality is the exception rather than the rule in Canada.
Establishing Criminal Jurisdiction in Canada
SUBJECT MATTER JURISDICTION
The Real and Substantial Link Test
Strict Territoriality
In Libman, the SCC laid down the test for determining subject matter jurisdiction. The facts of the case are as follows. Mr Libman operated a telephone sales solicitation room in Toronto. He employed a number of individuals as telephone sales personnel. On his directions, the salesmen made material misrepresentations to US residents about their identity, their location, and the quality and value of shares in two mining companies that purportedly engaged in gold mining in Costa Rica. The US residents received, in addition, promotional materials sent from Costa Rica and Panama by Libman’s associates there. These misrepresentations induced the US residents to buy shares in the two mining companies. These shares were later shown to be worthless. The US residents were asked to send their purchase money to offices operated by Libman’s associates in Costa Rica and Panama, from where Libman collected his share, which he brought back to Toronto to settle with his salesmen.
Libman was charged with conspiracy to commit fraud. The issue before the SCC was whether Libman could be prosecuted in Canada. Libman’s lawyers raised the point that the essential element in the offence was the deprivation of the US victims of their money and that such deprivation, if any, occurred outside Canada. The alleged offence could therefore not be tried in Canada. Justice Gerard La Forest, who penned the opinion of the Court, rejected the idea of picking one ingredient of an offence and holding the place where that ingredient occurred as the location of the offence. Footnote 57 He affirmed that the primary basis of criminal jurisdiction in Canada is territorial, but he noted that other bases of jurisdiction are equally permissible in international law, among them the nationality principle and the protective principle. Footnote 58 After reviewing English authorities on transnational crimes, he decried the “doctrinal confusion” that characterized the way England had approached the question. Footnote 59 His survey revealed that no single principle could be said to reconcile the various approaches English courts had taken in dealing with transnational crimes. Still, he recognized a general drift away from the traditional notions of territoriality that sought for the location of “the gist of the crime” or “where it was completed” towards a search for the existence of ample links between the crime and the jurisdiction. Footnote 60 To determine where a crime should be prosecuted in transnational cases, he noted, what the English courts did “was to consider the substantial links that connected the crime to that jurisdiction,” without denying that the crime may have “sufficient links to different jurisdictions to justify prosecution in more than one place.” Footnote 61 His review of Canadian jurisprudence produced the following summary:
In the early years after Confederation the territorial principle was narrowly construed in both civil and criminal cases, consistent with Canada’s dependent status. But as time went on the courts began to interpret their territorial jurisdiction more liberally. On the whole, though, despite their policy of extending jurisdiction, they tended to apply the gist of the offence approach more consistently and mechanically than the English courts. The countervailing policies that, rightly or wrongly, affected the House of Lords in Board of Trade v. Owen, supra, do not appear to have been perceived in the Canadian cases that took the opposite view. However, as in England, the Canadian courts were prepared to move beyond the gist of the offence test when the impact of a crime was felt in Canada. And like the English courts, too, they in time adopted techniques to avoid the strait-jacket in which the rigorous application of that test had put them, notably the technique of continuing offences. Footnote 62
La Forest J’s approach was to sift through the policy thrusts of the different judicial approaches, both in England and in Canada, and identify the rationales that informed the various shifts in the jurisprudence. The rationale of the English House of Lord’s reasoning in DPP v Doot found particular favour with La Forest J. Doot was a conspiracy initiated outside England for the purpose of smuggling narcotics to the United States via England. Footnote 63 In holding that English courts had jurisdiction, Lord Cyril Salmon adopted the “continuing offence” theory, reasoning that the offence was amply linked with any state through which the narcotics passed. Footnote 64
Relating Lord Salmon’s reasoning to Canada, La Forest J declared that Canada “has a legitimate interest in prosecuting persons for activities that take place abroad but have an unlawful consequence” in Canada. Footnote 65 In considering whether a criminal transaction falls outside Canadian jurisdiction, he stated that one must “take into account all relevant facts that take place in Canada that may legitimately give this country an interest in prosecuting the offence.” Footnote 66 He declared the test as follows: [A]ll that is necessary to make an offence subject to the jurisdiction of our courts is that a significant portion of the activities constituting that offence took place in Canada. … [I]t is sufficient that there be a ‘real and substantial link’ between an offence and this country, a test well-known in public and private international law.” Footnote 67 La Forest J stressed that no legislation was required for the validity of this test, as “it was the courts after all that defined the manner in which the doctrine of territoriality was applied” and that this test simply animates the earlier formulations of the territoriality principle. Footnote 68 Applying the test to the facts of Libman, he found that there were “ample links” with Canada: the fraudulent scheme was devised in Canada and the operations that made the scheme function — the salesmen, the boiler room, and so on — were located in Canada. Footnote 69
The Effects Doctrine
Libman has been interpreted as engaging only the territoriality principle and not addressing cases of extraterritorial conduct that produces effects in Canada. Footnote 70 This argument, however, is not consistent with the practice of lower courts, which shows a striking inconsistency in the interpretation of what constitutes the requisite link. In R. v Klassen, Justice Austin Cullen of the British Columbia Supreme Court stated:
Libman was dealing with the circumstances that justify a court assuming jurisdiction over a particular offence in the absence of explicit extraterritorial legislation, and was thus necessarily based on the territoriality principle alone. It says little or nothing about jurisdiction over offences based on the four other principles recognized in customary international law. Footnote 71
In R. v O.B., the accused was alleged to have sexually assaulted his granddaughter during a car trip to the United States and while they were in the United States. Footnote 72 The question was whether Canada had jurisdiction to try him. The Court of Appeal for Ontario held that there was no real and substantial connection with Canada and that for such a connection to exist “there must be a significant link between Canada and the formulation, initiation, or commission of the offence.” Footnote 73
The British Columbia Court of Appeal, however, has interpreted Libman as supporting effects-based jurisdiction. In R. v Hammerbeck, the accused had lawful custody of a child for a specified period of time, after which he was required to return the child to its mother. Footnote 74 He took the child from its mother in British Columbia and travelled with it to California. If he had returned the child to its mother in British Columbia within the lawful custodial period permitted him under the custody order, he would not have committed any offence. But he kept the child in California beyond the lawful custodial period. His lawyers argued that since he could lawfully take the child to California, provided he returned the child to its mother within the permitted period, the act of “taking” took place in California and not in British Columbia. Accordingly, British Columbia had no territorial jurisdiction. There was evidence that he formed the intention in British Columbia to unlawfully detain the child in California.
In resolving the jurisdictional issue, the British Columbia Court of Appeal cited with approval the following statement of the Court of Appeal for Ontario in Re Bigelow and The Queen:
The test in reality has become whether any element of the offence has occurred in the province claiming jurisdiction. … They are offences where the province claiming jurisdiction can establish, first, a continuity of operation extending from that province to other provinces; secondly, the commission of an overt act in that province, or thirdly, the registration of effects in that province from acts committed in other provinces. Footnote 75
The Bigelow case was an interprovincial custody case. Mother and child lived in Ontario, while the father lived in Calgary where he took the child. The charge was laid in London, Ontario. The argument was that the detention of the child occurred in Alberta and not in Ontario, so that Ontario courts did not have jurisdiction. The Court of Appeal for Ontario concluded, among other things, that, as the effect of the withholding of the child in Alberta was felt in Ontario, Ontario courts had jurisdiction. Although this case was decided before Libman, the British Columbia Court of Appeal stated that “[t]he test in Libman encompasses the test in Bigelow and applying it to the case herein establishes that the Supreme Court of British Columbia had the jurisdiction to try the appellant.” Footnote 76
In addition, in Re Ouellette and The Queen, two Canadian residents were vacationing in the Bahamas, while one (the accused) struck the other. Footnote 77 The victim later died in a hospital in Canada. The question was whether the accused could be prosecuted in Canada. Justice Pierre Béliveau of the Quebec Superior Court cited both Libman and R. v O.B. and stated the law as follows:
[There are] two basic hypotheses in relation to the connection of an offence to Canada. First, the crime may have been committed in Canada but have effects outside of Canada or, second, it may have been committed outside of Canada and produce harmful consequences in Canada. ... [I]t is clear that there is no principle concerning the matter which would be against Canadian courts taking jurisdiction in either situation. Footnote 78
Neil Campbell and William Rowley write that “[t]he courts have not definitively determined whether subject-matter jurisdiction exists in the reverse scenario where foreign conduct affects Canadian victims in Canada.” Footnote 79
It is not entirely accurate to interpret Libman as being limited to jurisdiction based on the territoriality principle alone. That it concerned jurisdiction in the absence of explicit extraterritorial legislation does not necessarily mean that it was based exclusively on the territoriality principle. While the specific facts of the case engaged the territoriality principle, the significance of the entire holding exceeds the territoriality principle. La Forest J cited approvingly the following statement by Lord Kenneth Diplock in R. v Treacy: Footnote 80 Nothing forbids
Parliament from prohibiting under pain of punishment persons who are present in the United Kingdom, and so owe local obedience to our law, from doing physical acts in England, notwithstanding that the consequences of those acts take effect outside the United Kingdom. Indeed, where the prohibited acts are of a kind calculated to cause harm to private individuals it would savour of chauvinism … to treat them as excusable merely on the ground that the victim was not in the United Kingdom itself but in some other state. Footnote 81
The converse is also correct, for nothing prevents Parliament from punishing persons who, while outside the United Kingdom, commit acts that have harmful consequences on persons within it, if they are later found in the United Kingdom: “The state is under a correlative duty to those who owe obedience to its laws to protect their interests and one of the purposes of criminal law is to afford such protection by deterring by threat of punishment conduct by other persons which is calculated to harm those interests.” Footnote 82
What is clear from the above remarks is that a state can assert extraterritorial jurisdiction without violating the principle of comity (discussed later). However, since the court was not faced with the reverse scenario engaging conduct abroad that produced harmful effects within Canada, La Forest J understandably saw no need to elaborate on this point. Yet, in his review of Canadian jurisprudence, he found that “though the courts were willing to find jurisdiction in Canada when the agreement and preparation took place here, they were also ready to hold that the country where the results contemplated by the conspiracy took effect also had jurisdiction though the accused was not present there.” Footnote 83 This statement suggests that were the fraudulent scheme orchestrated outside Canada, with adverse effects within Canada, La Forest J would have found “ample links” with Canada. Given that conspiracy is a crime that does not require consummation of the intended crime for its punishment, even if actual effects are not produced, jurisdiction would lie in the state where the effects are intended. In practice, however, such a state might have little interest to prosecute where the criminal plans are not actually carried out, depending, however, on the potential seriousness of the conspired crime. In the post-9/11 era, states would not hesitate to take jurisdiction over persons who conspire abroad to commit terrorist acts within their territory even if their plans have not been carried out.
This is the way in which English courts have treated the crime of conspiracy. Liangsiriprasert v United States was an appeal from the Hong Kong Court of Appeal to the Judicial Committee of the Privy Council over the extradition of a Thai from Hong Kong to the United States on charges of conspiracy to traffic dangerous drugs. Footnote 84 The conspiracy took place in Thailand. The trafficking was to take place in Hong Kong, but no overt act had yet occurred. Writing for the Privy Council, Lord Brian Griffith stated that an overt act was not an ingredient of the crime of conspiracy but, rather, that it may be useful in proving the existence of conspiracy. He held that a conspiracy formulated outside Hong Kong was triable in Hong Kong even in the absence of any overt act in Hong Kong if the conspiracy was intended for Hong Kong. Footnote 85 Thus, the only element linking the crime with Hong Kong was the intent to execute the conspiracy there. In the words of Lord Griffith,
[u]nfortunately in this century crime has ceased to be largely local in origin and effect. Crime is now established on an international scale and the common law must face this new reality. Their Lordships can find nothing in precedent, comity or good sense that should inhibit the common law from regarding as justiciable in England inchoate crimes committed abroad which are intended to result in the commission of criminal offences in England. Footnote 86
In fact, one might argue, as did the Hong Kong Court of Appeal in Attorney-General v Yeung Sun-shun, that where the conspiracy was not directed at residents of the state where it was formulated there is no sound basis in law or policy for that state to oppose the trial in the state whose residents were the target of the conspiracy. Footnote 87
Liangsiriprasert has been followed by later English cases. R. v Naini involved the defrauding of English nationals. Footnote 88 The appellants argued that as the English victims were based abroad when the crime was alleged to have been committed, England lacked jurisdiction. The English Court of Appeal applied Liangsiriprasert, holding that “[t]he residence of the party who suffered the loss did not determine where the crime of defrauding took place” and that, as the conspiracy to defraud was intended for England, English courts had jurisdiction. Footnote 89 This decision can be justified on the basis of the effects doctrine, Footnote 90 although strictly speaking it does not seem to fit properly into any known jurisdictional principle.
After examining the US judicial approach to “thwarted extraterritorial narcotics conspiracies,” Christopher Blakesley concludes that jurisdiction over those conspiracies comes very near to fitting into several of the known extraterritorial jurisdictional bases but actually fits into none of them. Footnote 91 He opines that attempting to cabin botched extraterritorial conspiracies into any of the traditional jurisdictional theories violates the “conceptual integrity” and traditional iterations of the theories. Footnote 92 He calls for the adoption of a “hybrid theory of jurisdiction,” founded on a principle of “reasonableness” that combines two or more of the traditional theories in order to meet the jurisdictional needs of the asserting state. Following the authorities reviewed above, it cannot be said that the occurrence of the effects of the offence within Canadian territory cannot supply the jurisdictional link necessary for Canadian jurisdiction. Rather, in considering whether there is a real and substantial link, the effects of the crime within Canadian territory is one of the factors to be considered. Whether it alone can fully supply the jurisdictional link would depend on the substantiality of the effects and, generally, the particular facts of the case.
Thus, given the nature of the crime of conspiracy, it is arguable that a thwarted extraterritorial conspiracy to commit a crime in Canada would meet the requirements of the real and substantial link test. To hold otherwise could defeat the purpose of criminalizing conspiracies. As an inchoate crime, it is “[a] step toward the commission of another crime, the step in itself being serious enough to merit punishment.” Footnote 93 In Shulman v The King — a case involving a conspiracy in Canada to induce members of the public outside Canada to purchase the shares of a worthless company — Justice Joseph-Charles Walsh stated that “[i]n the eyes of some people only financial gains matter; but there is more to conspiracy than its successful culmination. Its preparation and evolution, even in the case of failure, is reprehensible.” Footnote 94 In the words of Lord Griffiths in Liangsiriprasert, “it defeats the preventative purpose of the crime of conspiracy to have to wait until some overt act is performed in pursuance of the conspiracy.” Footnote 95 Justice Richard Meredith of the Court of Appeal for Ontario similarly wrote that “[t]he law would be lame if it were powerless to reach conspirators so long as they took care to agree to carry into effect their wrongs beyond the borders of the country in which they conspired to do the wrongs. It must be born in mind always that the crime of conspiracy may be complete without anything having been done to carry it out.” Footnote 96 La Forest J cited this statement of Meredith JA with apparent approval in Libman. Footnote 97 Botched extraterritorial conspiracies may be deemed to be potentially connected with the state where they are intended to be carried out. There is no reason why such a potential connection should not suffice to meet the requirements of the real and substantial link test for the purpose of prosecuting extraterritorial conspiracies. All that would be required is proof that the conspirators intended to carry out their conspiracy there. Footnote 98
The point being made here is that, with respect to conspiracies, insisting on actual (in the sense of physical) connection, as opposed to potential connection, would defeat the essence of criminalizing conspiracies. This would be particularly so where the conduct conspired to be committed is not criminalized in the state where the conspiracy took place. Given the pre-emptive goal of criminalizing conspiracies, regarding the potential effects of botched extraterritorial conspiracies as being sufficient is largely consistent with the dictionary meaning of “real” and “substantial.” In the Canadian Oxford Dictionary, the following words/expressions are used to describe the meaning of “real”: “actually existing or occurring in fact,” “not imaginary,” “actual or true,” “not just appearing so,” “genuine,” and “sincere.” Footnote 99 It defines the word “substantial” as “of considerable importance, size or worth”. Black’s Law Dictionary uses the words “actual,” “genuine,” and “true” to define “real” and defines substantial as “being significant or large and having substance.” Footnote 100 The catchall word seems to be “genuine” — that is, not false or sham. A proven extraterritorial conspiracy to commit a crime in Canada cannot be described as having a false connection with Canada. Canada has a genuine interest to prevent it from happening by punishing the conspirators if they are found in Canada. For the purpose of Canadian jurisdiction, the substantiality of the connection to Canada would then depend on whether the conspiracy is intended to be executed wholly or partially in Canada.
It should be pointed out, however, that jurisdiction over botched extraterritorial conspiracies is encompassed by section 465(4) of the Criminal Code, which expressly renders justiciable in Canada conspiracies formulated outside Canada but that are intended to be executed in Canada. Footnote 101 What is being argued here is that in the absence of such an express statutory grant, the real and substantial link test provides a valid basis to assume jurisdiction over botched extraterritorial conspiracies. Thus, while the real and substantial link test is especially suited to jurisdictional claims based strictly on territoriality, it may also be used to support jurisdictional claims over botched extraterritorial conspiracies. There also exist in Canada cases where Canadian courts have exercised jurisdiction over non-conspiracy offences consisting of acts committed abroad that produced adverse effects in Canada. Footnote 102 Such an exercise of jurisdiction has been justified on the basis of the “continuing offence” theory. Footnote 103
Applying the Real and Substantial Link Test to the Extraterritorial Criminal Conduct of Canadian Corporations
Applying the real and substantial link test to the extraterritorial criminal conduct of Canadian corporations, the necessary connection can be established in a variety of ways. It would be established if it can be shown that the preparation of the offence took place (in whole or in part) in the corporation’s office (or anywhere else) in Canada even though it was executed abroad. The preparation could have been done by telephone with the other conspirators located abroad. Where the Canadian corporation operated through its foreign subsidiary, all that is required for the necessary connection to be established is for the Canadian parent to be somehow implicated in the conduct of its subsidiary. Thus, owing to the doctrine of corporate separate personality, a clearer territorial connection between the offence and Canada would be required for jurisdiction to lie. Where the alleged extraterritorial conduct is that of the parent corporation’s subsidiaries without the participation of the parent, there would be no real and substantial link with Canada unless Canadian criminal law imposes obligations on Canadian parent corporations towards their foreign subsidiaries and those obligations have been breached or unless the conduct has an unlawful consequence in Canada. In this latter alternative, the only obstacle to a Canadian court exercising jurisdiction would relate to personal jurisdiction over the foreign subsidiaries since they are located abroad. The issue of personal jurisdiction in criminal law is dealt with later.
Crimes against Humanity and War Crimes Act (CAHWC Act)
Jurisdictional Framework
The long title of the Act makes it clear that the Act is intended to criminalize in Canada genocide, crimes against humanity and war crimes, to implement domestically the Rome Statute and to make consequential amendments to other Acts relevant to the prosecution of these crimes. It creates and redefines these crimes. It defines a “crime against humanity” as
murder, extermination, enslavement, deportation, imprisonment, torture, sexual violence, persecution or any other inhumane act or omission that is committed against any civilian population or any identifiable group and that, at the time and in the place of its commission, constitutes a crime against humanity according to customary international law or conventional international law or by virtue of its being criminal according to the general principles of law recognized by the community of nations, whether or not it constitutes a contravention of the law in force at the time and in the place of its commission. Footnote 104
It defines “genocide” as
an act or omission committed with intent to destroy, in whole or in part, an identifiable group of persons, as such, that at the time and in the place of its commission, constitutes genocide according to customary international law or conventional international law or by virtue of its being criminal according to the general principles of law recognized by the community of nations, whether or not it constitutes a contravention of the law in force at the time and in the place of its commission. Footnote 105
And it defines a “war crime” as
an act or omission committed during an armed conflict that, at the time and in the place of its commission, constitutes a war crime according to customary international law or conventional international law applicable to armed conflicts, whether or not it constitutes a contravention of the law in force at the time and in the place of its commission. Footnote 106
The CAHWC Act establishes Canadian jurisdiction over these offences regardless of whether they are committed in or outside Canada. In doing so, it incorporates the international law jurisdictional principles of nationality, passive personality, and universality. Its section 8 reads:
A person who is alleged to have committed an offence under section 6 or 7 may be prosecuted for that offence if:
-
(i) at the time the offence is alleged to have been committed,
-
a. the person was a Canadian citizen or was employed by Canada in a civilian or military capacity,
-
b. the person was a citizen of a state that was engaged in an armed conflict against Canada, or was employed in a civilian or military capacity by such a state,
-
c. the victim of the alleged offence was a Canadian citizen, or
-
d. the victim of the alleged offence was a citizen of a state that was allied with Canada in an armed conflict; or
-
-
(ii) after the time the offence is alleged to have been committed, the person is present in Canada.
This provision is an expansion of a 1987 amendment of the Criminal Code, which extended the jurisdiction of Canadian courts to war crimes and crimes against humanity committed outside Canada if the person was, or became, a Canadian citizen or was found in Canada after the commission of the crime. Footnote 107 Instead of criminalizing war crimes and crimes against humanity through defining these crimes, the amendment simply allowed acts amounting to war crimes or crimes against humanity (as defined in international law) to be prosecuted in Canada as if they had been committed in Canada. The CAHWC Act, however, defines these crimes and provides (under section 8(b)) that jurisdiction may be assumed over anyone who commits the stated crimes outside Canada and is later present in Canada, even where the culpable act was committed before the coming into force of the section. The only requirement for universal jurisdiction under the Act, therefore, is that the suspect be present in Canada. Section 8(b) creates no further requirement as the conditions that apply under subsection (a) do not apply under subsection (b). “The rationale for this enlarged mandate,” Morris Rosenberg has argued, “is the universal condemnation of the conduct as criminal and the fact that the alleged perpetrator creates the required nexus to Canada at the time he or she enters our country.” Footnote 108 However, since the perpetrator is present in Canada only after the crime has been committed, the characterization of his or her presence in Canada as a form of connection with Canada in relation to the alleged crime is dubious. The exercise of jurisdiction based only on the suspect’s retroactive connection with the forum is one of the highest forms of universal jurisdiction discernible in international law, second only to trial in absentia. Footnote 109
Since the coming into force of the CAHWC Act in 2000, there has been only one successful prosecution that is based on it: R. v Munyaneza. Footnote 110 Munyaneza was accused in a Quebec court of murdering and raping civilians and of leading attacks against ethnic Tutsis at the National University of Rwanda during the 1994 Rwanda genocide. He was charged with seven counts of genocide, crimes against humanity, and war crimes. On 22 May 2009, the Superior Court of Quebec found him guilty and sentenced him to life imprisonment without parole for twenty-five years. On 7 May 2014, the Quebec Court of Appeal dismissed Munyaneza’s appeal against conviction. Footnote 111 The case is historic for being the first trial under the CAHWC Act and the only trial that ended with a guilty verdict. Footnote 112 Beyond this, however, the case is of little assistance in the determination of the jurisdictional aspects of the Act. The only aspect of jurisdiction that was contested in the case related to the recognition of the alleged acts as war crimes in international law at the time the alleged acts were committed (that is, in 1994). The appellant argued that even if the alleged acts amounted to war crimes under international law in 1994, he could still not be prosecuted in Canada under the CAHWC Act, which did not exist at the time, because the operative Criminal Code did not regard the alleged acts as war crimes. Footnote 113 To apply the CAHWC Act retroactively to those acts would, according to the appellant, violate section 11(g) of the Canadian Charter of Rights and Freedoms. Footnote 114 The court held, however, that war crimes, as they are understood in international law, include certain serious crimes committed during a non-international armed conflict. Footnote 115 On the retroactivity argument, the court held that the CAHWC Act does not attempt to create an offence retroactively but merely permits the prosecution of persons who, before its enactment, had already committed acts recognized as offences in international law. Footnote 116 There was no jurisdictional challenge to the offences of genocide and crimes against humanity.
The non-broad challenge of the jurisdiction of the court might be because of the facts of the case and the expansive nature of the jurisdiction uttered in the CAHWC Act. It might equally be because Munyaneza was charged in his own capacity. The 200-page judgment focused largely on analyzing the evidence substantiating the indictment. Footnote 117 The judge’s analysis of the substantive content of the international crimes, while correct, is lacking in “breadth” and “depth.” Footnote 118 Since the case concerned a natural person who was charged in his own capacity, its usefulness to the analysis of the Act’s applicability to corporations is very limited, if not altogether nil, in light of the lack of depth in the judge’s analysis. The Act’s applicability to foreign corporate conduct must therefore be based exclusively on a textual analysis of the Act.
Application of the CAHWC Act to Corporations
The CAHWC Act is silent on the issue of applicability to corporations. However, this does not necessarily lead to an inference that it does not apply to corporations for the Act’s silence may be contrasted to an identical provision in the Rome Statute that explicitly confines the definition of the court’s jurisdiction to natural persons. Footnote 119 Section 2(2) of the Act states that “[u]nless otherwise provided, words and expressions used [therein] have the same meaning as in the Criminal Code.” This implies that the Act is not a self-contained and freestanding piece of legislation but, rather, one that is intended to merge with the Criminal Code for the purpose of prosecuting genocide, crimes against humanity, and war crimes. Footnote 120 While listing the offences chargeable thereunder, the Act makes use of the words “every person” who commits. Footnote 121 Nowhere in the Act is “every person” defined. As this expression is used and defined in the Criminal Code, the definition uttered in the Criminal Code applies to the Act. Section 2 of the Criminal Code states: “‘[E]very one’, ‘person’, ‘owner’, and similar expressions include Her Majesty and public bodies, bodies corporate, societies, companies and inhabitants of countries, parishes, municipalities or other districts in relation to the acts and things that they are capable of doing and owning respectively.” Supporting this definition is section 35 of the Interpretation Act, which states that “[i]n every enactment … person, or any word or expression descriptive of a person, includes a corporation.” Footnote 122 It follows inexorably that the words “every person” used in the Act includes corporations. It follows that the Act applies to corporations as much as it applies to individuals. And given the Munyaneza decision, corporations can be prosecuted for acts committed before the enactment of the CAHWC Act. Footnote 123
In addition, in accordance with section 8(b), the presence of the suspect — in this instance, the corporate suspect, in Canada is necessary for prosecution. The CAHWC Act does not define when a suspect can be said to be present in Canada. In the case of natural suspects, this poses no difficulty. Complexities arise in the case of corporate suspects. This is due to the principles of separate personality and limited liability, under which shareholders, employees, or directors of a corporation cannot ordinarily be held accountable for the actions of the corporation and under which, likewise, parent corporations cannot ordinarily be held accountable for the actions of their subsidiaries or vice versa. In cases where the direct liability of the Canadian parent is alleged, determining the suspect’s presence poses no difficulty since the corporation is registered in Canada. But where indirect liability is alleged, it becomes necessary to establish the nature of the relationship between the Canadian parent and its foreign subsidiary. In the absence of any guide under the CAHWC Act for determining this, Canadian courts may turn to the “agency theory” of the common law for guide. The common law has applied the following factors to determine agency: (1) are the subsidiary’s profits treated as those of its parent; (2) does the parent appoint the persons conducting the business of the subsidiary; (3) is the parent the head and brain of the trading venture; and (4) is the parent in effective and constant control of the parent? Footnote 124
The provisions of section 2(3)(a) of the Canadian Business Corporations Act may also be applied. Footnote 125 It provides that
a body corporate is controlled by a person or by two or more bodies corporate if (a) securities of the body corporate to which are attached more than fifty per cent of the votes that may be cast to elect directors of the body corporate are held, other than by way of security only, by or for the benefit of that person or by or for the benefit of those bodies corporate; and (b) the votes attached to those securities are sufficient, if exercised, to elect a majority of the directors of the body corporate.
Under these circumstances, the actions of the foreign subsidiary may be attributed to the Canadian parent corporation, with the result that the suspect may be said to be in Canada for the purposes of jurisdiction under the CAHWC Act. Other modes of implicating the Canadian parent through the acts of its representatives are discussed later under the doctrine of corporate criminal liability.
Criminal Code
Besides the CAHWC Act, the Criminal Code itself contains provisions permitting the prosecution of extraterritorial crimes in Canada. One of these provisions is section 465 (which replaced section 423) of the Criminal Code. The section deals with extraterritorial conspiracies. The relevant portions of the section are contained in subsections (3) and (4):
(3) Everyone who, while in Canada, conspires with anyone to do anything referred to in subsection (1) in a place outside Canada that is an offence under the laws of that place shall be deemed to have conspired to do in Canada that thing.
(4) Everyone who, while in a place outside Canada, conspires with anyone to do anything referred to in subsection (1) in Canada shall be deemed to have conspired in Canada to do that thing.
Subsection (1)(a) deals with conspiracies to commit or cause the commission of murder, subsection (1)(b) deals with conspiracy to prosecute a person for an alleged offence that the conspirator knows that person did not commit, while subsection (1)(c) and (d) deals with conspiracy to commit indictable and summary offences. It is apparent that the provision embodies the principle of double criminality for jurisdiction to lie. In Bolduc v Attorney General of Quebec, the SCC stated that section 465 “does not create an offence … [but] creates a presumption of territoriality so as to make the conspiracy an offence punishable in Canada.” Footnote 126 It is necessary to prove that the accused violated foreign law and that the conduct would equally have amounted to an offence in Canada were it committed in Canada. Bolduc related to an offence of unlawful entry into the United States. The appellant argued that identity of offences means that unlawful entry into the United States must itself constitute an offence in Canada. That is to say, there must be a statutory provision in Canada criminalizing unlawful entry into the United States. The prosecution responded that the essence of the provision is that the offence has its equivalence in Canada and that the corresponding offence in Canada to unlawful entry into the United States is unlawful entry into Canada. Writing for the whole court, Justice Julien Chouinard held that in determining the identity of the offences, the focus should be on the “essential elements” of the offences and not on whatever name they are called in both countries. He concluded that the presumption under section 465(3) means that “persons who have conspired to cause others to come into the United States unlawfully are deemed to have conspired to cause persons to come into Canada unlawfully.” Footnote 127
Craig Forcese has argued that “transnational jurisdiction over a conspiracy to commit a wrongful act other than murder requires both that the conspiracy take place in Canada and that the act which the conspirators seek to commit overseas be an offence under the laws of the foreign jurisdiction.” Footnote 128 This argument does not capture section 465(4), which relates to conspiracy formulated outside Canada. Subsection (4) is not limited to conspiracy to commit murder but includes conspiracy to commit an “indictable offence.” Footnote 129 It creates transnational jurisdiction over a conspiracy formulated outside Canada to commit an offence, including murder, in Canada by deeming such an offence to have been committed in Canada. This means that jurisdiction over a conspiracy to commit a wrongful act other than murder in Canada does not require that the conspiracy itself take place in Canada.
The British Columbia Court of Appeal considered the provisions of section 465 (which, again, were then under section 423) in R. v Lai and Lau. Footnote 130 A conspiracy formulated in Hong Kong and Malaysia to import drugs into Canada was thwarted when one of the conspirators was arrested in Toronto. The other conspirators were extradited from Hong Kong to Canada and convicted by the Supreme Court of British Columbia. The accused argued on appeal that the Supreme Court of British Columbia had no jurisdiction to try them because the conspiracy was not formulated in British Columbia and that the only Canadian province that might have jurisdiction was Ontario, being the only Canadian province where any part of the conspiracy might be said to have taken place. In dismissing the jurisdictional challenge, Justice of Appeal William Esson relied on section 465(5) (which was then section 423(5)), which provides:
Where a person is alleged to have conspired to do anything that is an offence by virtue of subsection (3) or (4), proceedings in respect of that offence may, whether or not that person is in Canada, be commenced in any territorial division in Canada, and the accused may be tried and punished in respect of that offence in the same manner as if the offence had been committed in that territorial division. Footnote 131
Other provisions abound in the Criminal Code criminalizing extraterritorial conduct. Most of the provisions reflect Canada’s desire to implement its international legal obligations. These provisions include section 7(4.1) dealing with extraterritorial child sex trafficking in implementation of Canada’s obligations under the United Nations Convention on the Rights of the Child; Footnote 132 section 7(1) dealing with offences on an aircraft; section 7(2.01) dealing with offences committed in relation to cultural property in implementation of the Convention for the Protection of Cultural Property in the Event of Armed Conflict; Footnote 133 section 7(2.1) dealing with offences relating to international maritime navigation; section 7(3.1) dealing with offences against hostage taking; section 7(3.71) dealing with offences against UN personnel; sections 7(3.2) and (3.72) dealing with offences involving nuclear material, explosives, or other lethal devices; section 7(3.7) dealing with torture committed by government officials or by persons acting with the consent or acquiescence of government officials; and section 7(3.73) dealing with offences related to the financing of terrorism. Most of these provisions require some sort of connection with Canada — either through the nationality of the offender or that of the victim Footnote 134 and, in some cases, through the residence (ordinary or permanent) of the offender Footnote 135 — for jurisdiction to lie. Most of them also embody the double criminality requirement. Footnote 136 Some provisions also provide for universal jurisdiction similar to the CAHWC Act. Footnote 137 There is nothing in the nature of the offences that suggests that corporations cannot be held liable for their violations.
Relationship between the Real and Substantial Link Test, the CAHWC Act, and the Criminal Code
The real and substantial link test is a purely jurisdictional test developed by the courts and is therefore based on the common law. As noted earlier, in Libman, La Forest J did point out that no legislation was required to validate the test because the test simply animates the earlier formulations of the territoriality principle. Footnote 138 On the other hand, both the CAHWC Act and the Criminal Code serve the dual purpose of creating jurisdiction and creating the offence over which jurisdiction is to be assumed. This means that extraterritorial corporate criminal prosecution can take place wholly and exclusively under either of the two statutes, without any reference to the real and substantial link test. Prosecution based on the real and substantial link test must be grounded on an alleged violation of a substantive offence under either the CAHWC Act or the Criminal Code.
With regard to the CAHWC Act, which was enacted to deal specifically with a particular species of crime — namely, crimes against humanity and war crimes — and establishes its own jurisdictional framework, there is the question of whether the common law-based real and substantial link test can be utilized to ground jurisdiction under the Act. Two opposing views are possible. The first is that the Act is a specialized criminal statute and that the jurisdictional regime created thereunder is exclusive. That is to say, neither the real and substantial link test nor the jurisdictional provisions of the Criminal Code or any other criminal statute can be applied to ground jurisdiction over a CAHWC Act offence. Support for this view may be drawn from the opinion of the SCC in Bhadauria v Board of Governors of Seneca College of Applied Arts and Technology, although this was a civil case and did not concern jurisdiction. Footnote 139
In this case, certain types of discrimination were prohibited under the Ontario Human Rights Code. Footnote 140 The Code establishes a complaints procedure that has a board of inquiry to deal with complaints. The plaintiff brought action in the Ontario Superior Court of Justice claiming that she had been discriminated against in her workplace and that the Code permitted a civil action irrespective of the “administrative” consequences provided under it. She urged the court to recognize the tort of discrimination from a breach of the Code. Rejecting this contention, the SCC held that when the legislature creates a comprehensive regulatory enforcement regime, private and civil actions are excluded. Footnote 141 The Court regarded the Code as a self-contained regime that had created its own enforcement mechanism and did not admit of any other. Applying this reasoning to the CAHWC Act, it is arguable that the CAHWC Act is a self-contained regime with its own jurisdictional grounds and admits of no other. Being a criminal statute, it ought to be interpreted strictly.
The second view is that the real and substantial link test is not incompatible with the policy goals of the CAWHC Act and so would, theoretically, be applicable to CAWHC Act offences. Given the entrenched nature of the test in Canadian criminal law, it is arguable that the test is automatically incorporated by Parliament into the CAWHC Act and that explicit language is required to exclude it. Whichever view is taken, a look at the grounds established under the CAHWC Act — nationality of the offender, nationality of the victim, the employment of the offender, and the mere presence of the offender in Canada — shows that they are broader than the real and substantial link test and even the Criminal Code. This renders the application of the test or the jurisdictional grounds under the Criminal Code redundant for the prosecution of Canadian extractive corporations alleged to have participated in crimes against humanity and war crimes in their overseas operations.
On the other hand, the relationship between the real and substantial link test and the Criminal Code (a general criminal statute, in contrast to the specialized nature of the CAWHC Act) can be described as complementary. Where the Criminal Code provides for a substantive offence, the real and substantial link test can be the sole consideration for jurisdiction. Where the Criminal Code not only creates the substantive offence but also provides the grounds for jurisdiction, those grounds — where they relate to connections with Canada — can serve to activate and bolster the real and substantial link test.
PERSONAL JURISDICTION
Where subject matter jurisdiction has been established, it is still necessary to establish jurisdiction over the person of the suspect. Trial in absentia is unknown to Canadian criminal law. Footnote 142 The suspect must therefore be physically or legally present within the jurisdiction of the court. The criminal summons must be served personally on the individual suspect. Footnote 143 In the case of a corporation, the summons may be served by physically delivering it to the “manager, secretary or other executive of the corporation or a branch thereof.” Footnote 144 Ex juris service of criminal summons is thus unknown to Canadian criminal law. In Schulman v The Queen, the accused was personally served by a Royal Canadian Mounted Police officer in Australia for alleged violations of Canadian income tax laws. Footnote 145 When the accused did not appear at the trial, the prosecution brought a motion to proceed ex parte. The Supreme Court of British Columbia granted the motion. Mr. Schulman’s lawyers applied to stop the trial on the basis of defective service. The court accepted Mr. Schulman’s lawyers’ application, and the Crown appealed. Dismissing the appeal, the British Columbia Court of Appeal stated:
[I]n penal proceedings such as those here, a summons cannot properly be served on a person outside Canada without such service being authorized by a statute, and that in the absence of a proper service the Court has no jurisdiction over the person, even though it may have jurisdiction over the subject-matter of the complaint. Footnote 146
In R. v RJ Reynolds Tobacco (Delaware), the Crown posted a summons from Ontario by registered mail to the corporate accused’s address in the United States. Footnote 147 The accused had no office or place of business in Canada. The Crown drew the court’s attention to the fact that section 701.1 of the Criminal Code incorporates the service procedures of a province. In Ontario, the Provincial Offences Act allows summons to be executed on a corporation “by registered mail to the corporation at an address held out by the corporation to be its address.” Footnote 148 The provision is silent on whether the address must be a Canadian address. Justice Ian Macdonell held that because the Criminal Code has incorporated provincial service procedures, and since the Ontario Provincial Offences Act allows service by mail, the mailed service was proper and effective. He stated that, in any case, service was affected in Ontario where the summons was mailed and not in the United States where the summons was received. In other words, service was complete at the point of mailing the summons, and the actual place of delivery was inconsequential for, under Ontario law, there was no requirement to show that the mail was actually delivered to the addressee. Upon review, however, Justice Arthur Gans held that the mailed service was ineffective to establish personal jurisdiction over the corporate accused. Gans J stated that the incorporation of provincial procedural rules on service did not render service outside Canada effective for the purposes of federal prosecution. In his words, “[i]f Parliament wished to provide service of a summons ex juris beyond the borders of Canada, it should have done so in clear and unequivocal language.” Footnote 149 The absence of territorial language in the service provision was thus not viewed as permitting ex juris service. The decision is justified on the basis that the prohibition of ex juris service of criminal summons is so well entrenched in the common law of Canada that clear and explicit language is required to supplant it.
The holdings in Schulman and Reynolds Tobacco have important implications for the prosecution of Canadian corporations operating overseas. They mean that personal jurisdiction cannot be taken against a foreign subsidiary of a Canadian corporation that has no office in Canada. Unless the participation of the Canadian parent in the offence can be established, jurisdiction may not lie over the Canadian parent since the principle of separate corporate personality would operate to shield the parent from liability for the activities of its subsidiary. Martin Low has suggested that it might be theoretically possible to effect service of criminal summons abroad through mutual legal assistance treaties. Footnote 150 Under Article 2 of the Canada-United States Mutual Legal Assistance Treaty, the assistance to be mutually provided by the two states includes “service of documents.” Footnote 151 Although this has never been used to initiate criminal prosecution in either Canada or the United States, Low suggests that the service of documents could include serving summons on a corporation situated in the United States to compel its attendance for trial in a Canadian court. Footnote 152
Whether service of originating summons in criminal cases is within the language of the treaty is debatable. Given the entrenched nature of the rule against ex juris service of criminal summons in Canada, it is highly unlikely that ex juris service of originating criminal summons can be read into the treaty in the absence of clear language. However, even if the treaty contains such language, it cannot be said that it thereby alters the rule against ex juris service within Canada’s domestic forum. Rather, it merely creates obligations on Canada to assist the United States to effect such service on Canadian soil, should the United States so request, and a corresponding duty on the United States to allow Canada do the same should Canada so request. But Canada would request such assistance only if its domestic law permits ex juris service. As Low puts it, while the treaty permits the service of documents, and assuming “documents” include originating criminal summons, “the legal effect of serving documents has to be determined by other, specific provisions of Canadian law.” Footnote 153 Justice Arthur Dilks partially captured these points when he wrote in R. v Filinov, with reference to this very treaty, that “the only provisions of the treaty which had to be addressed in new Canadian legislation were those that dealt with the procedure whereby assistance was to be given by Canadian authorities to their counterparts in the United States.” Footnote 154 Assuming, however, that Canada is inclined to initiate ex juris service of criminal summons under the cover of the treaty, it might be concerned that the United States might reciprocally seek ex juris service against Canadian corporations equally under the cover of the treaty. Footnote 155
It might yet be possible to take criminal jurisdiction over a foreign corporation. This may be done through service effected on senior-level employees of the foreign corporation who are found in Canada since service on a corporation can be effected through its senior-level employees, like managers and secretaries. In Santa Marina Shipping Co v Lunham & Moore Ltd, the Ontario Superior Court held that such service could be effective only where it is shown that the senior officer is in Canada on the business of the corporation. Footnote 156 Although this case dealt with the service of civil summons, there is no clear basis on which to regard such service as improper for the purpose of criminal trial of the foreign corporation where a real and substantial link between the offence and Canada has been established, and it is shown that the senior manager is in Canada on the business of the foreign corporation. In civil actions, the corporation must have some ongoing presence in Canada to be considered resident. This does not seem to apply in the criminal context because residence is not a basis for criminal jurisdiction. And since the service of criminal summons is effected on a senior officer of the corporation, the rule in Santa Marina can be extended to criminal proceedings provided the criminal conduct has a real and substantial link with Canada.
It is also possible to indirectly cause the attendance of a corporate suspect, thus to procure personal jurisdiction over it, through the process of extradition. Although extradition is used to secure the attendance of individual suspects, it has served in one Canadian case as a means of securing the attendance of a corporate accused, albeit indirectly. In the Thomas Liquidation case, Footnote 157 charges were brought against parties resident in the United States as a result of their engagement in deceptive marketing against Canadians in violation of the Competition Act of Canada. Footnote 158 Canada made an extradition request to the United States and an arrest warrant was issued against the individuals. One of the suspects, who was an executive officer of Thomas Liquidation, waived his right to an extradition hearing and came to Canada and pleaded guilty to the charge. He not only pleaded guilty on behalf of himself, but he also pleaded guilty on behalf of Thomas Liquidation, the corporation accused. Although the extradition of the senior officer would not have automatically activated jurisdiction over the corporation due to the separate legal personality of the corporation and due to the fact that the senior officer could not be said to have been in Canada on the business of the corporation, the threat of extradition of the senior officer led to voluntary surrender to jurisdiction by the corporation through its senior officer. Footnote 159 The case remains the only case in which extradition was used to indirectly cause a foreign corporation to stand criminal trial in Canada.
Comity and the Assumption of Extraterritorial Criminal Jurisdiction
Benjamin Perrin has argued that the real and substantial link test is primarily about making sure that “claims of adjudicative jurisdiction respect the international principle of comity.” Footnote 160 There is support for this view in La Forest J’s reasons. The centrality of comity in La Forest J’s formulation of the real and substantial link test was such that the only factor that could have prevented the learned jurist from declaring that Mr. Libman was triable in Canada was comity. He used the words of Lord Diplock in Treacy, cited earlier. Footnote 161 He also endorsed Lord Salmon’s sentiments in Doot Footnote 162 to the effect that “we should not be indifferent to the protection of the public in other countries. In a shrinking world, we are all our brother’s keepers.” Footnote 163 Stressing that comity means nothing more than “kindly and considerate behaviour towards others’,” La Forest J asked philosophically:
How considerate is it of the interests of the United States in this case to permit criminals based in this country to prey on its citizens? How does it conform to its interests or to ours for us to permit such activities when law enforcement agencies in both countries have developed cooperative schemes to prevent and prosecute those engaged in such activities? To ask these questions is to answer them. Footnote 164
What La Forest J is saying is that the real and substantial link test serves as a safeguard for the principle of comity. It must be pointed out, however, that the test does not provide a safeguard for comity in cases involving international crimes like war crimes and crimes against humanity committed abroad. Footnote 165 Instead, it is the presence of treaties and customary international law governing those crimes that provides a yardstick for the application of comity. Although La Forest J seemed oblivious to this point in Libman, he did recognize it in his dissent in R. v Finta, when, in evaluating the applicability of Libman, he wrote: “The international community has not only stated that it does not object to our exercising jurisdiction in this field; it actively encourages the prosecution of those whose criminal conduct also constitutes war crimes or crimes against humanity.” Footnote 166 The relevance of the existence of international treaties to considerations of comity is also contained in the following remarks of Justice Willard Estey in R. v Spencer. Footnote 167 Comity, according to Estey J,
is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation, having due regard both to international duty and convenience and to the rights of its own citizens or of other persons who are under the protection of its laws. Footnote 168
Thus, if assuming jurisdiction in war crimes and crimes against humanity committed abroad is in the interest of the international community, then no issue of comity is involved or, to put it more correctly, asserting jurisdiction will be in the interest of comity. Michael Hirst writes: “[C]onsiderations of international law or comity impose no such general constraint on the ambit of a state’s criminal law.” Footnote 169 He notes that “considerations of international law have tended” in recent times to increase the scope of English criminal law in order to enable England to fulfil its international obligations. Footnote 170 Perrin suggests that relying on treaty law or customary international law as a basis for jurisdiction “respects comity more fully than other possible approaches.” Footnote 171 This is because no state party to a treaty can be heard to complain that its interests are being infringed upon as a result of a jurisdiction exercised by another state on the basis of that treaty. In the case of customary international law, this disability to complain is placed on every state since every state is enjoined to prosecute violations of customary international law.
In fact, La Forest J restrained to cast the real and substantial link test into a rigid formula. Instead, he left the limits of the test to be determined by the requirements of international comity. In his words, “the outer limits of the test may, however, well be coterminous with the requirements of international comity.” Footnote 172 These “outer limits” have hitherto not been spelled out. In R. v Cook, Justice André Bastarache stated that “it is permissible to assert criminal jurisdiction over acts taking place in another state if they are connected to other acts that take place in the forum state which are in furtherance of criminal behaviour, or if the acts in the other state have some pernicious consequence within the forum.” Footnote 173 However, it has been argued that it is “largely inconsistent both with the wording in Libman and the practice of lower courts” to say that extraterritorial conduct that has adverse effects within Canada can ground Canadian jurisdiction without offending the principle of comity. Footnote 174 But this argument overlooks La Forest J’s clear statement that Canada “has a legitimate interest in prosecuting persons for activities that take place abroad but have an unlawful consequence” in Canada. Footnote 175 In his review of Canadian jurisdictional practice, La Forest J also stated that “though the courts were willing to find jurisdiction in Canada when the agreement and preparation took place here, they were also ready to hold that the country where the results contemplated by the conspiracy took effect also had jurisdiction though the accused was not present there.” Footnote 176
Libman should not be understood to be creating a novel jurisdictional theory per se that is in opposition to the theories already adopted by Canadian courts. Rather, what La Forest J intended to do — and did do — in Libman was to create order out of the doctrinal chaos manifest in the miscellany of jurisdictional approaches adopted by Canadian (and English) courts. He observed that all of the approaches boiled down to a requirement of some form of connection with the forum territory. The real and substantial link test should therefore be viewed as the common denominator in all of the jurisdictional approaches hitherto adopted in Canada. It is an all-encompassing, shorthand expression of the different approaches. While there was a focus on connection related to the elements of the offence in Libman, there was clear recognition that the consequences of the offence could supply the requisite connection.
After noting the interest of the international community in seeing that no offence goes unpunished, Béliveau J stated the applicable test as:
[a] test of varying content which is assessed in relation to the circumstances and, in particular, the importance of the elements of the offence linked to Canada, the relevant facts which arose in Canada and the harmful consequences which were caused, or which could have been caused, in Canada. When weighing these factors, one must determine whether, by taking jurisdiction over the matter, the Canadian court offends international comity and one must take into account the universally recognized objective of not letting crime go unpunished. Footnote 177
However, in Treacy, Lord Diplock wrote that “the rules of international comity … do not call for more than that each sovereign state should refrain from punishing persons for their conduct within the territory of another sovereign state where that conduct has had no harmful consequences within the territory of the state which imposes the punishment.” Footnote 178 He thereby implied that unless the conspiracy has actually been executed in the state where it is intended to be executed — thus, unless it has actually had harmful consequences there — comity would prevent the intended state from taking jurisdiction. This view seems to have been supported by Bastarache J who in Cook cited with approval the above remarks of Lord Diplock. Footnote 179 However, it is arguable that the nature of the conduct that is conspired to be committed would prevent the operation of comity if it is such that the international community has an interest in. Conspiracies in one state to commit acts of terrorism in another may provide an example in the present era.
However, Lord Diplock’s statement is not consistent with later English decisions. In Liangsiriprasert, Lord Griffith wrote that,
[u]nfortunately in this century crime has ceased to be largely local in origin and effect. Crime is now established on an international scale and the common law must face this new reality. Their Lordships can find nothing in precedent, comity or good sense that should inhibit the common law from regarding as justiciable in England inchoate crimes committed abroad which are intended to result in the commission of criminal offences in England. Footnote 180
In fact, one might argue, as did the Hong Kong Court of Appeal in Attorney-General v Yeung Sun-shun, that where the conspiracy was not directed at residents of the state where it was formulated, that state cannot reasonably seek to invoke comity to stop trial in the state whose residents were the target of the conspiracy. Footnote 181 Lastly, La Forest J’s notion of comity as “kindly and considerate behaviour towards others” may have a positive implication for the prosecution of extraterritorial corporate crimes. One might ask, as did La Forest J, how considerate is it of the interests of other countries to permit corporate criminals in Canada to prey on their citizens through the instrumentality of an intricate network of subsidiaries? How does it conform to Canada’s interests or to those of other countries for Canadian courts to turn a blind eye to overseas corporate criminal activities of Canadian corporations merely because the conduct was executed by the corporations’ overseas subsidiaries? The answer to these questions is too obvious to require demonstration.
Finding the Criminal Liability of a Corporation
On 27 October 2003, the Canadian Parliament passed Bill C-45 — An Act to Amend the Criminal Code (Criminal Liability of Organizations) — the Westray Bill, named after a mining disaster that killed twenty-six miners in Westray, Nova Scotia. The bill was intended to modernize the law on the criminal liability (and sentencing) of corporations to reflect the complexity of modern business and organizational structures. It did so by expanding the theories underlying the attribution of criminal liability to corporations and other organizations. Before the coming into force of the bill, corporate criminal liability was based on the “identification doctrine.” The identification doctrine was tied to the “directing mind” of the corporation. For a corporation to be criminally liable under the doctrine, the corporation’s officer who directed or participated in the conduct in question must have been part of the directing mind of the corporation. This was called the “identification doctrine” because, as a corporation has neither brain nor volition, what the law sought to do was to identify the individual whose conduct (actus reus) and mental state (mens rea) could be attributed to the corporation by virtue of that individual’s position in the managerial hierarchy of the corporation. Footnote 182 The law regards any such person as the “directing mind” of the corporation. Footnote 183
To be a directing mind of a corporation, the person must have “governing executive authority” over the activity complained of. Governing executive authority means “authority to design and supervise the implementation of corporate policy rather than simply to carry out such policy. In other words, the courts must consider who has been left with the decision-making power in a relevant sphere of corporate activity.” Footnote 184 As Justice Frank Iacobucci put it, the court’s concern is whether the officer has “decision-making power in a relevant sphere of corporate activity.” Footnote 185 This means that governing executive authority is “activity-specific.” Footnote 186 It follows that a person could have governing executive authority in one sphere of corporate life but not in another. A person with governing executive authority in the operations department of a corporation could, for instance, not bind a corporation if he or she directed a criminal activity in the marketing department.
As the term “governing executive authority” suggests, one must look at the corporate structure of a corporation to identify the corporation’s directing mind. Such a person would naturally be high up in the corporate structure of the corporation. But how high such a person should be has not been clearly defined and varies from case to case, as it involves a fair measure of judicial discretion. It has been observed that Canadian courts are prepared to locate such a person at a lower level than do English courts. Footnote 187 Identifying the directing mind of a corporation would depend on the type of organization, the command structure of the organization, and the type of misconduct in question. Footnote 188 Generally, however, directing minds are located among the executives of the organization who have authority to set policies for the corporation; Footnote 189 ordinary managerial authority is not enough. Footnote 190 And Rhone v Peter AB Widener, Footnote 191 though a civil case, suggests that directing minds would be found at higher levels of authority. Footnote 192 This was the law as it stood before the Westray Bill.
The major provisions of the Westray Bill are now contained in section 22 of the Criminal Code. One of the major changes brought by this amendment is the application of the principles of corporate criminal liability not only to business corporations as traditionally understood but also to “organizations” generally. Organizations are defined as:
-
a. a pubic body, body corporate, society, company, firm, partnership, trade union or municipality, or
-
b. an association of persons that
-
(i) is created for a common purpose
-
(ii) has an operational structure, and
-
(iii) holds itself out to the public as an association of persons. Footnote 193
-
The reference to “organizations” as opposed to “persons” or “corporate bodies” was introduced so as to cover the various groups of persons that may not fit into the definition of “persons” or “corporate bodies” but that still engage in criminal activity. Footnote 194 The new amendment does away with the identification doctrine and establishes that, with respect to offences where the prosecution is required to prove fault, liability is attributable to an organization if a “senior officer” of the organization, with the intent at least in part to benefit the organization:
(a) acting within the scope of their authority, is a party to the offence;
(b) having the mental state required to be a party to the offence and acting within the scope of their authority, directs the work of other representatives of the organization so that they do the act or make the omission specified in the offence; or
(c) knowing that a representative of the organization is or is about to be a party to the offence, does not take all reasonable measures to stop them from being a party to the offence. Footnote 195
The provision goes further. It employs more specific language by expounding the definitions of “representative” and “senior officer”:
“[R]epresentative”, in respect of an organization, means a director, partner, employee, member, agent or contractor of the organization; [and] “senior officer” means a representative who plays an important role in the establishment of an organization’s policies or is responsible for managing an important aspect of the organization’s activities and, in the case of a body corporate, includes a director, its chief executive officer and its chief financial officer. Footnote 196
According to the Department of Justice Canada, a senior officer is defined by his or her function rather than by title. Footnote 197 This requires a consideration of the “context and structure” of the organization. Footnote 198 The officer’s title may be important in determining their function. It is therefore no longer necessary to establish the participation of the highest-level employees of a corporation; the participation even of middle managers may suffice to implicate the corporation. Footnote 199 As the Court of Appeal for Ontario observed in R. v Metron Construction Corporation, the amendment was intended to correct the difficulty created by the reality of modern corporate conduct in which decision making and responsibility is dispersed throughout the corporate ladder. Footnote 200 In this case, a site supervisor who Metron hired as an independent contractor and whose negligence caused the death of five workers (including his own) was regarded as a senior officer of Metron. Footnote 201
The new provision is far-reaching in another respect. Mere knowledge on the part of a senior officer that a representative of the organization is committing, or is about to commit, an offence would trigger the organization’s liability if the senior officer fails to take all reasonable steps to stop the representative from becoming a party to the offence, with the intention of benefiting the corporation. In R. v Briscoe, the SCC stated that “[w]ilful blindness does not define the mens rea required for particular offences” but that “it can substitute for actual knowledge whenever knowledge is a component of the mens rea.” Footnote 202 Although this was not in the context of corporate criminal liability, the point is well suited for an interpretation of section 22.2(b). In fact, from the manner in which section 22.2(b) is worded, even if the representative does not have the requisite mens rea to commit the offence, the corporation would still be liable based on the senior officer’s mens rea. Footnote 203 As Hélène Dragatsi puts it, the provision expands the notion of “agency” and brings it “closer to vicarious liability.” Footnote 204
In addition, the active participation of the senior officer in the conduct is not required to engage the corporation’s liability. The implication is that a corporation may be criminally liable even though the senior officer whose conduct triggered the liability cannot be held criminally liable in his or her individual capacity. This is because, as the SCC held in R. v Dunlop and Sylvester, Footnote 205 an individual’s knowledge of the criminal intent of another is generally not enough to ground his or her conviction. The senior officer need not have any authority in the specific sphere of activity from where the conduct emanated. A senior officer in the human resources department, for instance, can bind the corporation if he or she knows that a representative of the corporation, working in another department of the corporation, is engaged, or is about to engage, in criminal activity and, with an intent at least in part to benefit the corporation, fails to take all reasonable steps to prevent the representative from carrying on with the criminal activity. The provision thus silently enjoins all senior officers of a corporation to cooperate in their day-to-day activities within the corporation since this may be one of the best ways to avoid liability for the corporation. The only provisos are that (1) the senior officer must have acted with intent at least in part to benefit the organization; (2) the senior officer “knows” that the representative is engaged, or is about to engage, in the conduct; and (3) the senior officer did not exercise due diligence to prevent the crime. This requirement of “knowledge,” as opposed to “recklessness,” places a huge burden on the prosecution. However, as the Court of Appeal of New Brunswick has noted, section 22.2 potentially makes it easier for the prosecution to prove liability, “given a new reasonableness standard against which to measure the conduct of senior officers.” Footnote 206
The definition of “representatives” to include the corporation’s contractors is also significant in light of the modern practice of corporations. Modern corporations, especially those operating in crisis-prone regions, increasingly undertake most of their activities through contractors. The definition of “representatives” places a huge burden on corporations to pay close attention to what their contractors are doing in the course of executing their contracts. The wording of section 22.2(c) seems to have been slightly poorly drafted. It speaks of where a representative of a corporation “is or is about to be a party to an offence.” It requires the senior officer of the corporation to “take all reasonable measures” to prevent the representative from being a party to that offence. Taking the first alternative, where the representative “is” a party to an offence, what is there for a senior officer to prevent if the representative is already a party to the offence? Perhaps it should be interpreted to mean that a senior officer is required to stop the representative from continuing to be a party to the offence. This makes sense since the corporation’s liability begins only from the moment a senior officer becomes aware of the representative’s conduct. A contrary view would render this first alternative useless, it being impossible to stop what has already been done.
The second alternative containing the clause “is about to be a party to the offence” apparently speaks to a situation where the commission of the crime is at an inchoate stage. This includes where the representative is attempting or conspiring to commit an offence or counselling or aiding and abetting another person to commit an offence. If the senior officer takes all reasonable steps to prevent the representative from actually committing that offence, the corporation would not be liable for the attempt already made by the representative, although the representative may be liable for it in his or her individual capacity. Although these are by themselves crimes and punishable without more, they are steps towards the commission of substantive crimes. Acts that take place before their commission, such as the formation of the thoughts to commit them, are not cognizable as crimes. In R. v Chan, Justice of Appeal Janet Simmons of the Court of Appeal for Ontario stated that “[s]trictly inchoate crimes are a unique class of criminal offences in the sense that they criminalize acts that precede harmful conduct but do not necessarily inflict harmful consequences in and of themselves. It can thus be appreciated that it could extend the criminal law too far to reach behind those acts and criminalize behaviour that precedes those acts.” Footnote 207 It follows that there can be no attempt to commit an inchoate crime, unless the statute explicitly and specifically provides otherwise. Footnote 208 In United States of America v Dynar, Justice John Major stated that “[c]riminal law should not patrol people’s thoughts.” Footnote 209 In R. v Dungey, the Court of Appeal for Ontario held that “there is no such offence [in Canada] as attempt to conspire to commit a further substantive offence.” Footnote 210 This holding was confirmed by the SCC in R. v Déry. Footnote 211 The definition of attempt under section 24 of the Criminal Code differentiates attempt from preparation to commit a crime. Footnote 212 In Dungey, Justice of Appeal Charles Dubin, however, left the door of attempted conspiracy open to a possible exception to substantive conspiracy because the conspiracy in that context is the main focus of the harm and not seen as the risk of commission of a crime. Footnote 213
The provisions of section 22.2 may have important implications for the jurisdiction of Canadian courts over Canadian parent corporations for the actions of their overseas subsidiaries. True, the section does not contain any territorial language. But nothing in its drafting history suggests that it has extraterritorial application. However, the nature of the section is such that it is to be applied alongside other provisions of the Criminal Code as well as other criminal statutes, such as the CAHWC Act. Crimes against humanity and war crimes committed with the participation of foreign representatives of a Canadian corporation may trigger the application of section 22.2. A foreign subsidiary can serve as its parent’s representative for certain transactions. If, on the instruction of the parent corporation’s senior officer, the foreign subsidiary engages in conduct overseas that amounts to a crime there, the parent corporation may be held liable in Canada for such conduct. The same could apply to the corporation’s contractors, as suggested by the case of Metron. In fact, a combined effect of section 22.2 and the CAHWC Act imposes an onerous burden on Canadian corporations with regard to their foreign subsidiaries operating in war zones if they are to avoid criminal liability in Canada for crimes against humanity and war crimes committed on a foreign land. Lowering the category of employees who can bind a corporation makes it easier for a corporation to be implicated since knowledge of a senior officer of a corporation that a foreign subsidiary or contractor is engaging in the prohibited conduct abroad, and the failure of that senior officer to take all reasonable measures to stop the foreign subsidiary or contractor from committing the crime, with intent at least in part to benefit the parent corporation, would bind the corporation in Canada. Thus, section 22.2, while not directed at jurisdiction, has opened wider the gates of jurisdiction over corporations.
Conclusion
There is a strong legal basis for Canada to promote the accountability of its mining corporations operating in developing countries where regulatory and accountability mechanisms are weak. The real and substantial link test, the CAHWC Act, and the Criminal Code can ground the criminal prosecution of a Canadian mining corporation alleged to have been involved in human and environmental rights abuses that constitute crimes under Canadian law in the course of its operations overseas. While each of these three jurisdictional bases is sufficient by itself to ground jurisdiction, they are also mutually supporting, although the specialized character of the CAHWC Act raises questions whether the Act admits of a jurisdictional basis that is not explicitly incorporated into it. The Westray Bill, which amended the doctrine of corporate criminal liability in Canada, has significant jurisdictional implications to bolster the capacity of Canadian courts to assume extraterritorial criminal jurisdiction (whether based on the real and substantial connection test, on the CAHWC Act, or on the jurisdictional provisions of the Criminal Code) over Canadian mining corporations. If the Canadian government could enact the Corruption of Foreign Public Officials Act to hold Canadian corporations accountable for bribing foreign public officials in the course of their operations overseas, it could, with equal justification, express its disapproval of human and environmental rights abuses by the same corporations in the same business operations through the same criminal justice process. There are no apparent practical considerations preventing it from doing so that are absent in corruption cases.
