Impact on Quebecor prompts Pierre Karl Péladeau to appeal conviction for flouting election law

Pierre Karl Péladeau says he did not realise, when he pleaded guilty to violating Quebec's party financing law, that his Quebecor would be banned from holding public sector contracts for five years. He is appealing that that ruling after "involuntarily" breaking the law by contributing $135,500 for his leadership campaign. The maximum allowed is $500.

Quebecor could lose millions in public contracts after Péladeau broke party financing law

Pierre Karl Péladeau is appealing his conviction for breaking Quebec's electoral laws because he didn't realize a key fact — his guilty plea could have major repercussions on Quebecor. (Jacques Boissinot/Canadian Press)

Pierre Karl Péladeau, after pleading guilty to the largest-ever violation of Quebec's political party financing law, is appealing his conviction.

One of Quebec's wealthiest and most influential business leaders, Péladeau, who has danced from business to politics and back to business, explained in a Facebook post that he's appealing because he now realizes violating the Elections Act means Quebecor Inc. could lose millions in public-sector contracts.

Under the province's party financing rules, only individual Quebec voters can make political donations. The maximum contribution for a leadership campaign is $500.

Péladeau took out a $135,528.73 loan in order to help finance his 2015 Parti Québécois leadership campaign. 

On Facebook, Péladeau said after stepping down as leader in 2016, he decided that instead of finding enough voters willing to help repay his debt, he would pay it back himself, even though that's against the rules.

What Péladeau says he didn't know is that violating those rules is one of the offences, along with criminal convictions and tax evasion, that disqualifies companies from public-sector contracts under Quebec's anti-corruption laws.

The five-year ban would apply to new and existing public sector contracts.

Elections Québec fined him a record $27,600 because in addition to breaking the law, he was also leader of a major political party.

Says violation was involuntary

Péladeau returned to the helm of Quebecor, his family business, last year after stepping down as CEO in 2013.

Quebecor's main source of revenues these days is telecommunications. A five-year ban would shut its Videotron subsidiary out of lucrative public-sector telecommunications contracts.

Its TVA television channels rely on government contracts and tax credits.

"The future of several millions of dollars in contractual agreements, from contracts for telecommunications, to the production and broadcast of shows, such as La poule aux oeufs d'or, could be uncertain," he wrote on Facebook.

La poule aux oeufs d'or is a televised lottery TVA broadcasts, a joint venture with Loto Québec, the government's lottery and casino operator.

Parti Québecois Leader Pierre-Karl Péladeau and Julie Snyder hug after getting married. (Jacques Boissinot/Canadian Press)

Quebecor controls close to 40 per cent of the television market in Quebec through the various channels owned by TVA, and owns Quebec's largest circulation newspapers, Le Journal de Montréal and Le Journal de Québec.

Quebecor also has a 25-year contract with the City of Québec to manage the Centre Vidéotron amphitheatre. 

Not clear whether Québecor would lose contract to manage Quebec City's Centre Videotron, built in 2015 to attract a National Hockey League team that has not come. (Jacques Boissinot/CANADIAN PRESS)

But even though the province put up half of the $400 million it took to build the arena, it is not clear whether Quebecor's management contract for the Centre Vidéotron would be cancelled.

Quebec Treasury Board official Michèle St-Cyr could not confirm what would happen to that contract should Péladeau lose his appeal.

Péladeau noted on Facebook, though, that the premier could override the court decision if he does lose.

Father started Quebecor

Péladeau and his brother Érik inherited Quebecor from their father, Pierre, who started the media empire with Le Journal de Rosemont and a string of popular weeklies.

When his father died 1997, Pierre Karl took on his newspapers and printing ventures.

As president and CEO of Quebecor, Péladeau was paid $2.3 million last year.

Pauline Marois and Pierre Karl Péladeau. (Graham Hughes/CP)

Péladeau's foray into politics was a surprise even to close associates, including former prime minister Brian Mulroney, who remains chairman of the Quebecor board.

It began with the 2014 election campaign, when Péladeau announced he would be a PQ candidate because he wanted to give his children an independent country of Quebec.

Péladeau's clench-fisted salute revived the sovereignist issue, giving Philippe Couillard traction to turn around his until-then lacklustre Liberal campaign and evaporated the PQ's lead in polls. 

Couillard went on lead his Liberals to a majority government.

Then-PQ leader Pauline Marois resigned after losing the election, paving the way for Péladeau to succeed her.


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