The Extractive Sector Transparency Measures Act

Canada‚Äôs international commitment to participate in the fight against corruption

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This brochure helps identify which companies are subject to ESTMA, what is to be reported, attestation and timing, steps to take to diagnose if ESTMA is applicable, and steps to take to define, report and sustain ESTMA reporting.


Effective for financial years commencing on or after 1 June 2015, the Extractive Sector Transparency Measures Act (ESTMA) requires certain entities to report specific payments made in relation to the commercial development of oil, gas or minerals, including taxes, royalties, fees, production entitlements, bonuses, dividends and infrastructure improvement payments of CAD$100,000 or more to all levels of government in both Canada and abroad.

Payments to Aboriginal governments in Canada are only required to be included in reports from 1 June 2017.

The purpose of the ESTMA is to implement Canada’s international commitment to contribute to global efforts to increase transparency and deter corruption in the extractive sector. Both Canadian and foreign companies may be impacted if they have a place of business, do business, or have assets (of a certain value) in Canada.

Entities are required to enroll with Natural Resources of Canada (NRCan) by completing and submitting a contact form, which is available on NRCan’s website below. NRCan will provide each enrolled entity with an ESTMA ID Number, which must be referenced in all future correspondence with NRCan, including report submissions.

EY - Extractive Sector Transparency Measures Act Overview

Action required

Entities affected by this legislation should carefully review the guidance published and monitor changes resulting from the consultation period, as non-compliance with the legislation is subject to significant penalties.

Subject to NRCan's substitution process and determinations, entities may need to evaluate their reporting requirements in other jurisdictions in addition to the ESTMA and, accordingly, design accounting systems, controls and processes.

The NRCan guidance also discusses the ESTMA rules relating to attribution of payments. In the mining and metals sector, it is common for operational activities to be contracted out to a third party, who may or may not be one of the joint owners of the property. Significant judgement may be required in assessing who should report such payments.

The ESTMA also creates an additional administrative burden for junior mining and metals companies listed on any Canadian stock exchange, as these companies will be required to report payments regardless of the size of their assets or revenues, or how many employees they have.

At a time when the extractive sector is facing numerous challenges and there is a focus on reducing overhead costs, the reporting requirements of the ESTMA could be seen to create an additional unwelcome administrative burden. However, non-compliance is not an option as the ESTMA provides for penalties of up to CAD$250,000 for each day that the non-compliance continues.

To explore how EY can help you with the identification of payments, changes to systems and processes, substantive procedures or an attestation from an external auditor, please contact us.


Download the complete Extractive Sector Transparency Measures Act as a printable document


Download the complete
Extractive Sector Transparency Measures Act
as a printable document
(4.67 MB).