The federal Standing Committee on Natural Resources will investigate the ownership of Paper Excellence.
Today, the committee debated a motion introduced by NDP natural resources critic Charlie Angus to summon top officials from Paper Excellence and the federal government that recently approved the company’s takeover of pulp and paper giant Resolute Forest Products to testify before the Committee.
Although the meeting was held in camera, the minutes posted on the Committee’s website show that “it was agreed” that “the committee undertake a study of up to 2 meetings, at a time to be determined, regarding the ownership structure in the Canadian Pulp and Paper Industry specifically in relation to reports concerning the company Paper Excellence.”
The reports to which the Committee is referring are the media reports from the Halifax Examiner, CBC, Glacier Media, Le Monde and Radio France, which worked together on an investigation into Paper Excellence as part of the large Deforestation Inc. project led by the International Consortium of Investigative Journalists (ICIJ).
That reporting revealed links between Paper Excellence owned by Jackson Wijaya, and Asia Pulp & Paper (APP) owned by his father Tejuh Ganda Widjaya (sometimes also Widjaja), which is part of the massive multi-billion dollar Sinar Mas Group.
APP and Paper Excellence both say they operate entirely independently of each other.
The media reports also highlighted APP’s dubious financial and environmental record in Asia, as well as the complex and opaque corporate structures of both APP and Paper Excellence located in several offshore secrecy jurisdictions that the Tax Justice Network calls “tax havens.”
The CBC investigative team also uncovered a US$1.25 billion demand debenture from the China Development Bank, which had mortgages on three Canadian Pulp mills owned by Paper Excellence in 2012, “as part of the security for financing that was repayable on demand.”
As a result of these findings and the motion from Charlie Angus that arose from them, at today’s meeting the Natural Resources Committee also agreed that it would invite Paper Excellence owner Jackson Wijaya, “as well as Minister Francois-Philippe Champagne, Minister of Innovation, Science and Industry, and appropriate officials, as well as other relevant witnesses, to discuss the ownership structure and business relations of Paper Excellence Corporation, and that the committee report these findings back to Parliament.”
Champagne’s department is responsible for the Canada Investment Act, which approved Paper Excellence’s recent takeover of Resolute Forest Products.
As well, Champagne’s department is also responsible for the Competition Act, which governs the work of the Competition Bureau. At the end of December 2022, the Competition Bureau approved the acquisition of Resolute Forest Products by Paper Excellence via its subsidiary, Domtar, which Paper Excellence acquired in 2021.
With those acquisitions, Paper Excellence now controls 22 million hectares of forested land in Canada.
As the Examiner reported in part 5 of its Deforestation Inc series, Paper Excellence’s subsidiary Northern Pulp, currently enjoying creditor protection in the British Columbia Supreme Court and suing the province for $450 million because of lost profits due to the closing of the mill in Pictou County, owns 420,000 acres (170,000 hectares) of timberland in Nova Scotia. It also has a licence from the Department of Natural Resources and Renewables to harvest on another 308,000 hectares (761,000 acres) of Crown land in the province.
One member of the Committee who is not authorized to speak on the record confirmed that Angus’ motion had passed in today’s meeting. The committee member also told the Halifax Examiner there is no set date for the two committee meetings that will be devoted to studying the ownership structure of Paper Excellence.
Asked for comment, committee member Shannon Stubbs (Conservative) issued this statement:
I support our colleague’s aims to get more information for Canadians on that decision. We have said that there are a number of measures that the Liberals could take to lower the thresholds for security reviews — in particular from foreign, state owned and hostile regime acquisitions into resource development.
Paper Excellence has issued this statement:
Paper Excellence welcomes the opportunity to answer questions from the committee. We are committed to creating jobs and growing Canada’s forestry sector, maintaining a positive working relationship with government at all levels across the country. Paper Excellence strictly complies with environmental regulations; Domtar and Resolute share our commitment to the environment.
It is well known that Jackson Wijaya, the ultimate and sole owner of Paper Excellence, is the son of the current head of APP. In the early days, Jackson benefited from some experience gained from the family business early in his life, as well as support getting his company started. This is hardly a unique or exceptional circumstance.
The situation is entirely different today. Jackson operates Paper Excellence independently. Many stakeholders and regulators – global funding institutions, regulatory bodies and certifiers, among others – have acknowledged this reality. Paper Excellence’s acquisition of Resolute was extensively reviewed under the Investment Canada Act.
The Examiner has also asked Angus for an interview. We will update this article when we receive a reply.