Under the Conflict of Interest Act, reporting public office holders (RPOHs) must confidentially disclose their assets to the Conflict of Interest and Ethics Commissioner, divest controlled assets and make public declarations of certain assets.
For purposes of administration of the Act, there are three categories of assets that you need to be aware of if you are an RPOH:
Exempt assets, which are exempt from the Act’s divestment and public disclosure requirements. They are defined in section 20 of the Act as “assets and interests in assets for the private use of public office holders and the members of their family and assets that are not of a commercial character.” The definition includes a lengthy list of examples, among them primary and secondary residences, recreational property such as cottages and timeshares, farm land and buildings, cars and other personal means of transportation including off-road vehicles, cash and deposits, annuities, life insurance policies, pension rights and certain investments.
Controlled assets, which are defined in section 20 as “assets whose value could be directly or indirectly affected by government decisions or policy.” Examples listed include publicly traded securities of corporations and foreign governments. You are not allowed to hold or acquire controlled assets during your term of office. Determining whether assets fall within this category may not be easy because they are not always readily distinguishable from exempt assets. Please consult our Guideline on Controlled Assets.
A declarable asset is an expression used by the Office to describe those assets that are neither controlled nor exempt. This expression is not found in the Act. Subsection 25(2) requires RPOHs, within 120 days after their appointment, to make a public declaration of all of their assets that are neither controlled nor exempt.
Declarable assets include assets that generate income or revenue. Examples are an apartment in your home that you rent out, commercial farms and any interest in a private corporation (even if inactive).
Some exempt assets may become declarable assets during your term of office. For example, if you have a cottage that was only being used by yourself and members of your family when you took office but you are now renting it to third parties, it is no longer considered exempt under the Conflict of Interest Act and becomes declarable. Similarly, if you buy a new primary residence and rent out your former primary residence, your former primary residence would become declarable. NOTE: You must disclose to the Office any material change to any matter that you are required to report in your initial report to the Office, including your assets, within 30 days of the change. Failure to do so could result in an administrative monetary penalty.
New investment vehicles and products are regularly introduced by governments and the financial services sector and are, therefore, not specifically referred to in that list. Examples of these new investment vehicles are exchange-traded funds, index and commodities-linked notes, Capital régional and coopératif Desjardins, hedge funds, labour-sponsored funds, tax-free savings accounts and registered disability savings plans. Some of these new investment vehicles could fall within the general definition of exempt assets and others could fall within the general definition of controlled assets.
Advisors in our Office are available to provide you with additional information and confidential advice with respect to your individual situation. Please call 613-995-0721 or email firstname.lastname@example.org.