Vol. 148, No. 22 — October 22, 2014

Registration SI/2014-82 October 22, 2014

ECONOMIC ACTION PLAN 2013 ACT, NO. 2
CANADA PENSION PLAN

Order Fixing the Day on which this Order is made as the Day on which Section 277 of the Economic Action Plan 2013 Act, No. 2 Comes into Force

P.C. 2014-1021 October 9, 2014

Whereas subsection 114(4) (see footnote a) of the Canada Pension Plan (see footnote b) provides that where any enactment of Parliament contains any provision that alters, or the effect of which is to alter, either directly or indirectly and either immediately or in the future, among others, the Canada Pension Plan Investment Board Act (see footnote c), it shall be deemed to be a term of that enactment, whether or not it is expressly stated in the enactment, that the provision shall come into force only on a day to be fixed by order of the Governor in Council;

Whereas subsection 114(4) (see footnote d) of the Canada Pension Plan (see footnote e) also provides that such an order may not be made and shall not in any case have any force or effect unless the lieutenant governor in council of each of at least two thirds of the included provinces, as defined in subsection 114(1) (see footnote f) of the Canada Pension Plan (see footnote g), having in the aggregate not less than two thirds of the population of all the included provinces, has signified the consent of that province to the enactment;

Whereas section 277 of the Economic Action Plan 2013 Act, No. 2, chapter 40 of the Statutes of Canada, 2013, amends subsections 10(4) and (9) of the Canada Pension Plan Investment Board Act (see footnote h);

Whereas the lieutenant governors in council of each of at least two thirds of the included provinces, having in the aggregate not less than two thirds of the population of all the included provinces, have signified the consent of those provinces to those amendments;

And whereas section 278 of the Economic Action Plan 2013 Act, No. 2, chapter 40 of the Statutes of Canada, 2013, provides that section 277 comes into force, in accordance with subsection 114(4) (see footnote i) of the Canada Pension Plan (see footnote j), on a day to be fixed by order of the Governor in Council;

Therefore, His Excellency the Governor General in Council, on the recommendation of the Minister of Finance, pursuant to subsection 278 of the Economic Action Plan 2013 Act, No. 2, chapter 40 of the Statutes of Canada, 2013, and subsection 114(4) (see footnote k) of the Canada Pension Plan (see footnote l), fixes the day on which this Order is made as the day on which section 277 of the Economic Action Plan 2013 Act, No. 2 comes into force.

EXPLANATORY NOTE

(This note is not part of the Order.)

Proposal

To fix the date that section 277 of Economic Action Plan Act 2013, No. 2 (the Act) comes into force.

Objective

To permit qualified persons who are not Canadian residents to serve on the board of directors of the Canada Pension Plan Investment Board (CPPIB).

Background

The CPPIB is mandated to invest its assets in the best interests of Canada Pension Plan (CPP) contributors and beneficiaries. Greater global diversification allows income from foreign investments to flow back into Canada to support future pension payments. Over 70% of CPP fund assets are currently invested outside of Canada.

Currently, only Canadian residents can serve on the CPPIB’s twelve-person board of directors. International directors would provide a material benefit to the board through their deep local market and regulatory knowledge, as well as relevant international management experience.

The Act amends the Canada Pension Plan Investment Board Act (the CPPIB Act) to change residency requirements and allow international directors to sit on the board of directors. Changes to the CPPIB Act require the approval of the federal government and at least two-thirds of the included provinces representing at least two-thirds of the population.

The necessary level of formal consent from the provinces, in the form of orders in council issued by the provinces, has been confirmed, enabling the coming into force of the residency requirement amendment to the CPPIB Act.

Implications

The appointment of non-resident directors may impact regional representation on the CPPIB board of directors. In making a recommendation for an appointment to the board of directors, the Minister of Finance will continue to weigh impacts on regional representation, as required by the CPPIB Act.

Consultation

The following provinces have provided their formal consent for the legislative amendments in the form of Orders in Council issued by the provinces: Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario and Saskatchewan. This provides sufficient consent to meet the legislative requirement of formal consent from at least two-thirds of the included provinces representing at least two-thirds of the population.

Departmental contact

For more information please contact

Heather Kay
Chief
Government Financing Section
Financial Markets Division
Telephone: 613-369-3955