Leadership
races

Rules are now in place to make
the process more transparent


Legislation adopted by the National Assembly in December 2011 stipulates that leadership races of political parties are subject to a legal framework. As such, candidates must respect rules concerning the financing and auditing of campaign expenses that are now included in the Election Act (EA) and in the Act respecting elections and referendums in municipalities (AERM).

The main objective of the Act is to make leadership races more transparent. Throughout a leadership campaign, information concerning contributions and contributors is available on the Chief Electoral Officer’s website. Candidates’ expenses are recorded in reports that are disclosed to the general public.

The Act outlines offences and provides for substantial fines in cases where the rules are not respected.

404. The following are not election expenses:

(1) the cost of publishing articles, editorials, news, interviews, columns or letters to the editor in a newspaper, periodical or other publication, provided that they are published without payment, reward or promise of payment or reward, that the newspaper, periodical or other publication is not established for the purposes or in view of the election and that the circulation and frequency of publication are as what obtains outside the election period;

(2) the cost at fair market value of producing, promoting and distributing a book that was planned to be put on sale at the prevailing market price regardless of the election order;

(3) the cost of broadcasting by a radio or television station of a program of public affairs, news or commentary, provided that the program is broadcast without payment, reward or promise of payment or reward;

(4) the necessary costs of holding a meeting in an electoral division for the selection of a candidate, including the cost of renting a hall, of convening the delegates and of the publicity made at the meeting; the costs cannot exceed $4,000 nor include any other form of publicity;

(5) the reasonable costs incurred by a candidate for attending a meeting to select a candidate in an electoral division; the costs cannot include any publicity except that made by the candidate at the meeting;

(6) the reasonable expenses incurred by a candidate or any other person, out of his own money, for meals and lodging while traveling for election purposes, if the expenses are not reimbursed to him;

(7) the transportation costs of a candidate, if not subject to reimbursement;

(7.1) the other reasonable personal expenses incurred by a candidate, other than publicity expenses, if the expenses are not reimbursed to him;

(8) the transportation costs of any person other than a candidate, paid out of his own money, if the costs are not reimbursed to him;

(8.1) the cost of the food and beverages served at a political activity where the cost is included in the entrance fee paid by participants;

(9) the reasonable expenses incurred for the publication of explanatory commentaries on this Act and the regulations thereunder, provided the commentaries are strictly objective and contain no publicity of such a nature as to favour or oppose a candidate or a party;

(10) the reasonable ordinary expenses incurred for the day-to-day operations of not more than two permanent offices of the party the addresses of which are entered in the register of the Chief Electoral Officer;

(11) interest accrued from the beginning of the election period to the day occurring 90 days after polling day, on any loan lawfully granted to an official representative for election expenses, unless the official agent has paid the interest and declared it as an election expense in his return of election expenses;

(12) the expenses incurred for the holding of meetings, the total of which does not exceed $200 for the entire election period, including the renting of halls and the convening of participants, provided the meetings are not directly or indirectly organized on behalf of a candidate or party;

(13) the publicity expenses, the total of which does not exceed $300 for the entire election period, incurred by an authorized private intervenor in accordance with Division V, without directly promoting or opposing a candidate or party, to publicize or obtain support for the intervenor's views on a matter of public interest or to advocate abstention or the spoiling of ballots;

(14) the remuneration paid to a representative referred to in section 316.

87. Only an elector may make a contribution.
He shall do so only in favour of an authorized entity and only in accordance with this division.

88. Sums of money donated to an authorized entity and services rendered and goods furnished to it free of charge for political purposes are contributions.

The following are not contributions:

(1) volunteer work, the goods or services produced by such work and the use of a personal vehicle supplied for no consideration for that purpose;

(2) (subparagraph repealed);

(3) amounts paid to a political party under any Act, and reimbursements and advances on reimbursements of election expenses contemplated in Chapter VI of Title IV;

(4) a loan granted for political purposes by an elector or a bank, trust company or financial services cooperative at the current market rate of interest at the time it is granted, or a guarantee granted by an elector as surety;

(5) an annual amount of not over $50 paid by a natural person as dues of membership in a political party;

(6) at the option of the official representative of an authorized entity, applied equally to all the participants, an entrance fee to a political activity or rally, where the fee is not over $60 per day, up to one admission per person; the total amount collected must not exceed 3% of the total contributions collected by the entity in the period covered by a financial report; in the case of a party, that percentage applies to the total sum of the amounts collected by the party and by each of its party authorities;

(6.1) ancillary revenue collected at a political activity or rally in accordance with the Chief Electoral Officer's directives;

(7) air time on the radio or television or space in a newspaper, periodical or other printed matter made available free of charge outside an election period by any radio, television or cable broadcaster or any owner of a newspaper, periodical or other printed matter to authorized political parties, provided he offers such service equitably as to quality and quantity to the parties represented in the National Assembly and to the parties which received at least 3% of the valid votes in the last general election;

(8) transfers of funds between :
(a) the various authorized party authorities;
(b) an authorized party and any of its authorized party authorities; or
(c) an authorized party, any of its authorized party authorities and the official agent of an official candidate of the party.

Campaign
expenses

Expenses for a party leadership campaign are expenses incurred for purposes of this campaign by the candidate’s financial representative and the party’s official representative.

Exceptions concerning campaign expenses as so defined are the same as those that apply to election expenses (section 404 of the EA).

Authorization of expenses

  • Only the candidate’s financial representative, or in certain cases the party’s official representative, may authorize campaign expenses.

Expense ceiling?

  • Unlike election expenses, there is no ceiling for campaign expenses. The political party may, however, establish an expense ceiling for all of its candidates.

Reimbursement
of expenses?

  • The Chief Electoral Officer will not provide
    a partial reimbursement of campaign expenses, as opposed to the current practice as regards election expenses.

Players

The Chief Electoral
Officer

  • Provides support for political parties.
  • Tells electors and the general public who the candidates are and provides information concerning their financial operations during the campaign.
  • Ensures full compliance with the rules outlined in the Act.

The candidate’s
financial representative

  • Manages the collection of contributions and the candidate’s campaign expenses.
  • After the campaign is over, the financial representative settles the candidate’s debts, reimburses all borrowings and transmits all remaining funds to the party’s official representative.
  • Produces a financial report that is forwarded to the party’s official representative.

The party’s official representative

  • Manages the expenses incurred in organizing and holding the leadership campaign.
  • The official representative has no responsibility with respect to the management of the contributions collected or expenses incurred by candidates. The management of a candidate’s finances is therefore handled separately from those of the party.
  • After the campaign, the official representative receives the reports of the candidates’ financial representatives and produces a financial report concerning the financial management of the leadership race for the Chief Electoral Officer.

Contributions
and borrowings

The provisions outlining what constitutes or does not constitute a contribution made to a candidate for the leadership of a political party are practically identical to those applying to contributions made in accordance with the Election Act (sections 87 and 88 of the EA).

Soliciting and collecting

  • The financial representative is the only person who may solicit contributions for the benefit of the candidate that he or she represents.
  • Only an individual authorized by the financial representative may collect contributions.

Borrowings

  • The financial representative may take out a loan in order to cover campaign expenses. The candidate must have provided prior written authorization for this loan. An elector may guarantee the loan.

How to contribute

  • A contribution to a leadership candidate is made by filling out a contribution slip approved by the Chief Elector Officer.
  • A contribution of more than $50 must be made by cheque or by an order of payment other than cash.
  • As opposed to regular procedures that govern the financing of a provincial political party, the contribution is not forwarded to the Chief Electoral Officer. Any cheque or other order of payment is made out to the candidate and deposited in the account of the candidate’s financial representative.

Contributors

  • Only an elector may make a financial contribution to a candidate for party leadership.
  • The allowable maximum contribution is $500 per elector during the same leadership campaign.
  • An elector’s contribution must be made “out of the elector’s own property, voluntarily, without compensation and for no consideration, and cannot be reimbursed in any way.”
  • An elector contributing financially to a leadership campaign may make another maximum contribution of $100 to a political party during the calendar year during which the leadership race is held.

Disclosure of contributions

  • Every seven days following the date the campaign opens, until polling day, the financial representative will transmit the contribution slips to the Chief Electoral Officer.
  • At the latest five days following reception of the contribution slips, the Chief Electoral Officer will, in accordance with the provisions of the Act, post on his website certain information provided by the slips. It is the name of the contributor, the city and postal code of their residence, the amount of the contribution and the candidate who receives the contribution.
  • After polling day, the contribution slips will be transmitted to the Chief Electoral Officer every 30 days by the candidates’ financial representatives.

On the municipal front

Similar rules,
except that…

  • New provisions have been added to the Act respecting elections and referendums in municipalities (AERM) as regards leadership races for municipal parties. These are similar to the rules governing leadership races for provincial political parties, except that…
  • ...only an elector residing in the municipality may make a financial contribution.
  • ...no provision has been made for disclosure of contributions on a website during the leadership race.
  • ...only contributions of $100 or more provided for a leadership candidate will be publicly disclosed.
  • ...a tax credit applicable to contributions is the same as the due usually received for a contribution to a municipal political party. This credit may not, however be added to any other credit obtained by the elector for an “ordinary” contribution to a political party or candidate.
  • ...the maximum amount for a loan or guarantee granted by an elector is the amount stipulated under the AERM, i.e. $10,000.

After the
electoral event

Payment of debts

  • Within 60 days following polling day, creditors must forward their claims to the candidates’ financial representatives. The same applies for any claim addressed to the party’s official representative.
  • The financial representative has 12 months from polling day to settle all claims and borrowings. The Chief Electoral Officer may, however, grant an extension of up to 24 months from the first deadline of 12 months following polling day.
  • After the deadline for settling all claims and borrowings, any outstanding balance is deemed to be a contribution made by the candidate to his or her own campaign. The basic principle is that candidates are accountable for their debts and may be prosecuted for making (by presumption) a non-conforming contribution (for instance, for having exceeded the allowable maximum of $500).

Financial reports

  • Within 90 days following polling day, the candidates’ financial representatives must provide the party’s official representative with a financial report that includes, most notably, information concerning contributions collected and expenses incurred for the candidate’s campaign. Within 30 days following the latter deadline, the party’s official representative will provide the Chief Electoral Officer with a financial report concerning the administration of the leadership race. The report must include all the reports that the official representative received from financial representatives. At this point, these reports become part of the public domain.

Legal recourse by the Chief Electoral Officer

  • Offences similar to those established in the Election Act concerning regular financing of a party have been included in the new Act respecting political party leadership campaigns.
  • In cases where offences have been uncovered, the Chief Electoral Officer may start legal proceedings before the Court of Québec.
  • Sanctions, especially fines, may be imposed in cases of guilty pleas or verdicts.