TORONTO -- The controversial Bill C-300 cannot be properly amended and needs to be defeated, representatives of Canada’s mining industry told a Federal committee Thursday.

For several months, the resource sector has waged a quiet war against C-300, a private member’s bill created by Liberal MP John McKay. Under C-300, the federal government would gain new powers to investigate complaints made against Canadian resource companies working in foreign countries. If the companies are found to be responsible for human rights or environmental abuses, they could be denied financing by Export Development Canada (EDC).

The battle finally erupted into the spotlight this month after some eye-opening testimony against mining companies before the Foreign Affairs committee studying the bill. One former Argentine minister even said she was threatened and harassed by Barrick Gold Corp.

Thursday, representatives from large gold companies and law firm Fasken Martineau fired back, saying in their testimony that the legislation would put Canadian companies at a competitive disadvantage to foreign rivals, and would raise frivolous complaints against them to “a whole new level” of reputational damage.

Moreover, they said that the bill cannot be amended in any way that would make it fair for the industry. That is because private member bills cannot include provisions to spend public funds, and Fasken argued in its submission that such spending would be needed to do impartial investigations of resource companies (though spending rights can be granted in Parliament).

To make its case against C-300, Fasken brought former Federal international trade minister James Peterson and former high-ranking bureaucrat Raymond Chrétien to speak to the committee.

Mr. Peterson said that if he ran a mining company, he would move the head office out of Canada if this bill became law.

“I’d have to under these circumstances. I’d be denied EDC financing and I’d be subject to a different regime than the rest of the world,” he said.

Deepak Obhrai, a Conservative MP on the committee, said in an interview that he is “just stunned” that the Liberal party would allow this bill to be introduced.

“If the Liberal party was in government, they would never have brought this bill forward. Because they know the damage it would do to the economy,” he said.

He said the government has already spent years in consultations to improve corporate social responsibility for Canadian companies. That work led to the release of a paper this year called Building the Canadian Advantage.

Mr. McKay argued that the government still has no real means to investigate companies responsible for abuses abroad, and yesterday called C-300 a “very modest step” in that direction.

The bill remains unpopular with the organization that would be affected by it the most.

Jim McArdle, senior vice-president for Export Development Canada, told the committee last month that C-300 would not only restrict financing by EDC, but would also cause other lenders to think twice before financing Canadian companies. That would put them at a disadvantage to rivals “with less regard” for corporate social responsibility, he said.

Private member bills have a very low success rate. For C-300 to become law, it would have to clear the committee stage, pass a third vote in Parliament, and then get approved by the Senate. So far, it has not won support from Conservative MPs. Further, the Conservatives could gain effective control of the Senate some time next year, making it easier for them to block bills they do not like.

-- with files from Paul Vieira

pkoven@nationalpost.com