Policy on Political Contributions and Interactions with Government Officials

The purpose of this policy is to set clear and uniform parameters for making political contributions within the democratic political framework of jurisdictions that so permit, and for interaction with federal, state/provincial and local/municipal elected representatives and public-service officials.

A. Political Contributions

1. Domtar may make political contributions in accordance with applicable legislation.

2. In Canada, Domtar may make political contributions at the federal level and at the provincial and municipal levels, except in Quebec.

3. In the United States, given the various rules and regulations in respective jurisdictions, the Secretariat and Law Department should be consulted.

4. Political contributions may be made insofar as the organizations receiving them reflect and uphold the values of Domtar, of private enterprise, and support healthy market conditions.

5. To the extent it is allowed under the law, any federal, state/provincial, and local/municipal political contributions shall be made only to political parties and not to individual candidates, in response to a solicitation relating to a general election.

6. Political contributions may be financial but may also take the form of goods or services to which a commercial value is assigned. The use by employees of Domtar's financial or material resources for political purposes is strictly prohibited.

7. Domtar shall not pay its representatives' admission fees to partisan political activities. These activities are generally organized for the purpose of raising funds and may take the form of cocktails, meetings, banquets, meals, golf games or other similar activities.

8. Any political contribution by Domtar must have the prior approval of the President and Chief Executive Officer.

9. An annual report on political contributions must be submitted to the Board of Directors of Domtar.

10. The Senior Vice-President, Corporate Affairs, General Counsel and Secretary is responsible for implementation of this policy.

B. Interaction with Representatives of Government Agencies

Interaction with officials and employees of governments to insure the promotion of Domtar's interests is the responsibility of the Vice-President, Communications and Government Relations. All contacts with elected officials and employees of governments should be coordinated through the Manager of Government Relations (Canada) or the Director of Government Relations (U.S.).

It is customary business practice to maintain cordial, harmonious relations with officials and employees of governments at various levels. Although Domtar encourages such relations, it is absolutely essential that they comply with legislation and Domtar policies and they preserve the integrity and the appearance of integrity of both Domtar and its representatives as well as the officials and employees of governments.

1. The means used by Domtar shall be customary in the milieu, of a reasonable value, but shall not constitute a significant economic benefit for the recipient.

2. For example, and this is not an exhaustive list, the following are some of the means that may be used by Domtar:

• Tickets or invitations to sports events (baseball, football, basketball, hockey, tennis, etc.)
• Tickets or invitations to shows
• Meals in restaurants
• Golf games (local)

3. It must be noted that both under Canadian and U.S. law, the offer and acceptance by an elected representative or government employee of compensation, advantages, or benefits, for consideration of collaboration, help, influence, act or omission, etc., constitutes a criminal offence subject to imprisonment. This statutory offence involves both the giver and the taker, but deals with exorbitant or unreasonable advantages, benefits or compensation. Note also that the longer and closer the relationship is between the giver and the taker, the less the means used will be considered an illegal advantage or benefit.

4. Prudence and good judgment must be exercised and in case of doubt, the Senior Vice-President, Corporate Affairs, General Counsel and Secretary should be consulted.