Just before Christmas, when Prime Minister Justin Trudeau was asked if his government would intervene in the extradition of Chinese telecom executive Meng Wanzhou, who was arrested by Canada in early December at the request of the United States, he said he would not – because Canada “is and will always remain a country with the rule of law.”

It was reassuring to hear this from Trudeau, who earlier in his political career had praised China’s “basic dictatorship.” In any ranking of Canadian values the independence of our justice system is fundamental. The arrest of Meng has seriously complicated Canada’s relations with an unpredictable and aggressive global power, but we could take comfort from Trudeau’s insistence that in this country governments do not have the power to manipulate the law for political or other purposes. Or so we would like to believe.

It remains unclear exactly what triggered the January 14 demotion of Jody Wilson-Raybould to Minister of Veterans Affairs from her exalted position as the first Canadian of Indigenous descent to occupy the powerful Justice portfolio, followed by her February 10 resignation from cabinet altogether. The central allegation by anonymous sources in a stunning February 7 Globe and Mail story was that someone in the Prime Minister’s Office “pressured” her to intervene in the prosecution of corruption charges against Montreal engineering giant SNC-Lavalin.

The alleged motive was to avoid the destruction of an iconic Quebec company and thousands of jobs in the province during an election year. But if Wilson-Raybould resisted the pressure, and was demoted for doing so, why didn’t she resign then? Her brief public statements raised more questions than answers. Then she lawyered up, with a retired Supreme Court Justice no less, and at the time of this writing the nation is still breathlessly awaiting her version of events.

However tempting it is to fixate on the political scandal’s juicy details – or marvel at the epic clumsiness of the government’s ever-changing explanations – the sanctity of the rule of law remains the central issue in the SNC-Lavalin affair. And such evidence as exists so far strongly suggests the attempted hi-jacking of a new legal process designed to help police the conduct of Canadian corporations doing business overseas.

PM Trudeau and demoted Minister Wilson-Raybould during the January cabinet shuffle swearing in ceremony.

Like many such stories, it started with the best of intentions.

In 1997 Canada was one of the first countries to sign on to an international anti-bribery crusade driven by the Organization for Economic Co-operation and Development. One year later Parliament passed the Corruption of Foreign Officials Act (CFOA), making it possible to prosecute Canadian corporations at home for bribing officials overseas. This was, no doubt, a laudable endeavor, but in practice such prosecutions are time-consuming and excruciatingly expensive. Canada’s justice system has been noticeably less enthusiastic than many of its OECD partners in actually using such legislation. The U.S., by contrast, is far tougher on corporate fraud and bribery, often levying fines in the billions of dollars annually.

No surprise, then, that Ottawa would be interested in an innovation widely touted in the legal world as a way of saving time and money on CFOA cases – not to mention getting more successful convictions. Known as Deferred Prosecution Agreements (DPAs), the process is designed to encourage a company to come forward on its own, admitting candidly and completely to any foreign wrongdoing by its employees, managers and/or executives, promising to clean up its act, and paying a substantial fine. The authorities, for their part, agree to defer any related criminal charges until the company is deemed to have rehabilitated itself – and only then to drop the charges.

Much of the developed world has chosen to go this route. The U.S. has been using DPAs enthusiastically and the United Kingdom introduced them in 2014. A recent case involving Rolls-Royce plc illustrates how a DPA works. In 2017 the multinational manufacturer of aircraft engines, propulsion systems and energy industry power systems struck a deal with U.K. authorities in which it admitted to a dozen counts of bribery and corruption over a period of almost 30 years, in Indonesia, Thailand, India, Russia, Nigeria, China and Malaysia.

The presiding judge hailed the agreement as advancing the public interest as well as saving time and money in a case that would have been difficult for the authorities to prosecute successfully “without the full co-operation” of Rolls-Royce. He acknowledged that the company had cleaned up its act with sweeping internal changes (including new executive leadership) – then hit Rolls-Royce with a fine exceeding $1.1 billion, to ensure the company understood “the gravity of the conduct” to which it had admitted.

The billion-dollar fine was no slap on the wrist – even for a company with 2017 revenues of 15.1 billion pounds and a current market capitalization of nearly 25 billion pounds. The company’s share price took a temporary hit, but jobs and long-term investment were preserved, and a U.K. business icon survived. The political left lobbed some ineffective criticism – including calls to imprison the company’s top leaders – but the consensus was that Rolls-Royce had been punished appropriately without inflicting collateral damage on the majority of innocent employees and shareholders.

The Rolls-Royce case did not go unnoticed in Ottawa, where the then-new Trudeau government was coincidentally wrapping up its own consultation process regarding DPAs. The Justice Department, in fact, largely based its proposed changes to Canada’s Criminal Code on the U.K. model. This included having the Director of Public Prosecutions negotiate the proposed new “remediation agreements” and a senior judge implement them – with all of it to be done in public. This is unlike the American model, in which the Department of Justice handles cases in private. It also bears repeating that DPAs are aimed at corruption and other “white collar” crime – not crimes of violence, terrorism or threats to national security.

So far so good: Canada would get road-tested changes to its Criminal Code, bring us into line with many of our closest trading partners, encourage greater voluntary compliance with the CFOA, save the police and courts time and taxpayers’ money, and avoid loss of jobs and investment. The entire process would be “transparent” and subject to public scrutiny. What could go wrong?

Transparency was the first casualty. Instead of presenting the changes as stand-alone amendments to the Criminal Code and letting Parliament debate them, the government referred to them briefly in its 2018 Budget, saying only that it intended to introduce legislation “to hold corporate offenders to account.” Boilerplate stuff, and hardly anyone noticed.

The actual changes were then smuggled through Parliament in a massive 556-page budget implementation package, a.k.a. an omnibus bill, which the Liberals promised in their 2015 election platform never to use. When the bill went before the Commons Finance Committee in a late-night session last fall, many of the members, including some Liberal MPs, said they only became aware of the Criminal Code amendments when a senior Justice Department lawyer showed up to answer questions. The topic got all of 15 minutes discussion. SNC-Lavalin, on the other hand, apparently got substantially more time for input. According to lobbying records, over the past couple of years the company logged 67 meetings with government officials, including 23 with the Prime Minister’s Office, just on “justice and law enforcement issues”.

SNC-Lavalin’s keen interest in such issues is hardly surprising. With 52,000 employees and 2017 revenues of $9.3 billion, the Montreal-headquartered company bills itself as one of the world’s top engineering, project management and infrastructure companies. It is, without doubt, a Canadian success story – but in pursuit of that success it has run afoul of the law on projects from India to North Africa. In 2013 the World Bank banned SNC-Lavalin and its 100 subsidiaries from bidding on projects funded by the development agency for 10 years, citing company misconduct in Bangladesh and Cambodia.

In 2015 the RCMP laid charges against the company under the CFOA relating to $47 million in bribes allegedly paid to get contracts in Libya during the rule of dictator Moammar Gadhafi. It is those charges that have been the subject of a potential DPA. According to court documents, a former executive vice-president of SNC-Lavalin, Riadh Ben Aissa, who was convicted in Switzerland after admitting to the Libyan bribery, has been assisting the RCMP. Ben Aïssa, who resigned from the company in 2012, was also charged in 2014 with 16 counts, including fraud, for allegedly organizing $22.5 million in kickbacks to help SNC-Lavalin win a construction contract for Montreal’s new $1.3 billion McGill University Health Centre. In July 2018 he pleaded guilty to one charge of using a forged document. Fifteen other charges against him were dropped.

Last October the Globe reported that settlement talks between SNC-Lavalin and the office of the Director of Public Prosecutions had been “close to a deal”. The major sticking point was that any admission of guilt would automatically disqualify the company from Canadian government contracts for 10 years.

Without an admission of guilt it is difficult to see how the company would have even qualified for a DPA, given that the Criminal Code makes it abundantly clear that any agreement involves an “obligation” to fully admit guilt and “to cooperate in any investigation, prosecution or other proceeding in Canada – or elsewhere.” This requirement to cooperate and come clean about past sins lies at the heart of DPA philosophy.

Yet SNC-Lavalin has labelled the CFOA charges “without merit” and, in a recent statement, claimed that if any crimes had been committed they were the actions of “former employees” and, further, “if charges are appropriate, we believe that they would be correctly applied against the individuals in question and not the company.” Far from being co-operative, SNC-Lavalin’s attitude sounds more like a calculated attempt to brazen things out. It’s not difficult to see why the Director of Public Prosecutions apparently decided a DPA was not appropriate. At that point, politically, that’s where matters should have ended.

That they didn’t speaks volumes about the Trudeau government’s inability to understand the limits – the clearly legislated limits – of its power. Instead, according to the Globe’s February 7 bombshell, someone in the PMO pressured Wilson-Raybould to intervene with the Director to get SNC-Lavalin off the hook. Amazingly, on February 10 Wilson-Raybould’s successor as Justice Minister and Attorney-General, Montreal MP and former law professor David Lametti, told the House of Commons he thought it was still possible that SNC-Lavalin might have its prosecution deferred.

Then the prime minister himself plunged headlong into the legal process by publicly suggesting to reporters in Ottawa last week that prosecuting SNC-Lavalin has wider economic implications. “As a government, we take very seriously our responsibility of standing up for jobs, of protecting jobs, of growing the economy, of making sure that there are good jobs right across the country, as there are with SNC-Lavalin.”

While that may be a worthy sentiment in general, it is not merely legally irrelevant to the matter at hand, it’s in direct conflict with the new law. The government’s own Criminal Code amendments establishing Canada’s DPAs set out the factors prosecutors may and may not weigh in evaluating alleged offences under the CFOA, and whether or not to grant a DPA. There is one in particular that is of central relevance to this issue: “The prosecutor must not consider the national economic interest.”

This provision flows from the OECD convention on bribery. It is there specifically to prevent a government from playing politics with DPAs, as in cutting an important company some slack because a prosecution is politically inconvenient. And prosecuting SNC-Lavalin in the run-up to a federal election would be decidedly inconvenient for Liberal hopes in Quebec.

PM Trudeau and former principal secretary Gerald Butts.

The prime minister insists nobody in his office attempted to interfere with the SNC-Lavalin prosecution. Yet with the resignation on Monday of Trudeau’s principal secretary and long-time friend Gerald Butts, we now have two high-profile departures from the Trudeau government as a result of questions around the SNC-Lavalin case.

Wilson-Raybould was the Trudeau government’s progressive agenda personified. Butts is Trudeau’s closest friend and top strategist. Losing them both eight months out from the October election is devastating. Why they resigned has now become a yawning chasm of speculation that threatens to swallow whole the Liberals’ aspirations of a second term in office.

At best the government got into this mess through unpardonable ignorance of the law. At worst, Opposition leader Andrew Scheer is now raising the spectre of obstruction of justice, citing Section 139 of the Criminal Code, which applies to anyone who “attempts in any manner…to obstruct, pervert or defeat deals the course of justice is guilty of an indictable offence and liable to imprisonment for a term not exceeding ten years.”

That’s the thing about being governed by the rule of law. You actually have to understand the law – and abide by it. Even if you are prime minister.

Paul Stanway is a veteran Canadian journalist who lives in Calgary.