Justice Committee on Dec. 9th, 2014

[The Chair, Conservative, Mike Wallace]

I call this meeting to order.

Pursuant to the order of reference of Friday, October 24, 2014, we're dealing with Bill S-2, an act to amend the Statutory Instruments Act and to make consequential amendments to the statutory instruments regulations.

We are joined for the first hour by three witnesses. We have Ms. Proud from Consumer Health Products Canada. From the Standards Council of Canada, we have Mr. Walter and Mr. Girard. From the Canadian Council of Criminal Defence Lawyers we have Ian McCuaig.

Thank you for joining us. You'll each have approximately 10 minutes to give us your view on this piece of legislation. Then we'll do a round of questions.

Based on the order presented in front of us, we'll start with Ms. Proud from Consumer Health Products Canada.

[Karen Proud, President, Consumer Health Products Canada]

Thank you very much.

Good afternoon, Mr. Chair and ladies and gentlemen of the committee.

My name is Karen Proud and I am the president of Consumer Health Products Canada. For those of you who don't know us, we're the trade association that represents the companies that make evidence-based over-the-counter medications and natural health products. These are products you find in medicine cabinets in every Canadian home. From sunscreens and vitamins to pain relievers and allergy medications, people use consumer health products to maintain their health and manage their minor ailments. This is a fundamental part of self-care that is vital to the health of Canadians and to the sustainability of our health care system.

I'm very pleased to be here today to speak in support of Bill S-2 and want to thank the committee for the opportunity.

In our opinion this bill is important in two ways. It provides express authority for departmental regulatory authorities to utilize an important tool in the drafting toolbox where currently there exists ambiguity. More importantly, it creates efficiencies and flexibilities within the regulatory process that are necessary to keep pace with the rapid rate of change in the regulatory environment.

The bill also contains a number of safeguards that have been put in place to ensure that the use of these new authorities is in line with current regulatory practices. While we certainly support safeguards related to ensuring accessibility and maintaining official languages, we would call into question the limitations that this bill imposes on regulatory authorities when it comes to referencing documents they produce internally.

As it stands today, this bill would not allow departments to use dynamic references for documents they produce themselves or produce with a person or body in the federal public administration. We think this is a bit short-sighted. Our members' products are currently regulated under the Food and Drugs Act. The act, which was amended in 2012 through the budget implementation bill, Bill C-38 and again this past fall with Bill C-17, gives the Minister of Health the authority to incorporate by reference any document, regardless of its source, either as it exists on a particular date or as amended from time to time. The Safe Food for Canadians Act, which passed in November 2012, has similar broad authorities for incorporation by reference.

It may surprise the committee to hear that we fully support providing regulatory authorities with these broad authorities under the proper circumstances. Under the Food and Drugs Act, our members rely on the fact that the department can incorporate by reference documents that it produces, which change over time. For example, the “Compendium of Monographs” is a document produced by Health Canada and incorporated by reference into the natural health products regulations. It allows new product applicants to reference the data contained in the monographs to support the safety and efficacy of their products rather than providing evidence for ingredients that are already known to be safe and efficacious when used under the conditions specified in the monographs. This significantly reduces the regulatory burden for industry and helps speed the evaluation of applications without compromising safety and efficacy requirements.

One of the biggest challenges with regulation is to maintain flexibility within the system to adapt to changing environments, so why tie the hands of regulators? Why not, instead, ensure that they have the tools they need and create a system of checks and balances to ensure that these tools are used responsibly? We recommend removing the limitations that are contained in Bill S-2 but ensuring that there is proper oversight so that these authorities, both in this bill and as they exist in other legislation, are used consistently and in the spirit in which they were intended by Parliament.

Specifically, we ask that the Treasury Board Secretariat be tasked to immediately develop guidance in the form of a cabinet directive that must be followed by departments when exercising the authority to incorporate by reference. We would also suggest that the Standing Joint Committee on Scrutiny of Regulations broaden its mandate to look not only at regulatory instruments but at the departments' adherence to Treasury Board guidance. With these two things in place, we feel departments will have access to an important regulatory tool with the proper oversight.

While I understand that the clause-by-clause review of this bill will take place immediately following this round of testimony, I do hope that you will consider our proposals. I look forward to any questions you may have.

Thank you.

[The Chair, Conservative, Mike Wallace]

Thank you, Ms. Proud.

Our next presenter is from the Standards Council of Canada.

Mr. Walter, the floor is yours.

[John Walter, Chief Executive Officer, Standards Council of Canada]

Thank you very much, Mr. Chair and members of the committee. I appreciate an opportunity to bring the viewpoint of the Standards Council of Canada and provide our comments in support of Bill S-2.

I'm going to give you a little background on myself personally, because I've been involved in the standards field for close to 25 years. I was appointed as the CEO of the Standards Council of Canada five years ago. Prior to that I was the vice-president for standards development of the Canadian Standards Association, and I was responsible for the development and maintenance of probably 3,000 codes and standards.

Prior to that I worked for the Government of Ontario for 30 years. The last 10 years, I worked as an assistant deputy minister of a technical standards division in the government and I was also the president and CEO of the Technical Standards & Safety Authority. For that last 10 years I was responsible for referencing many national, regional, and international standards into Ontario regulations.

Incorporation by reference has great significance to the entire network of organizations and individuals involved in standardization. I talk about standardization in both senses of the term. Standardization includes the development of standards, but also the testing of products by accredited certification bodies.

Technical standards are among the external documents most often cited by Canadian regulators. SCC monitors the use of standards in regulations by federal departments and agencies. In May of this year, our inventory included 1,118 standards that are referenced in federal regulations. There are a number of departments and agencies that make the greatest use of standards in those regulations: health, transport, environment, natural resources, the Canadian Food Inspection Agency, industry, and Employment and Social Development Canada.

Generally standards are referenced because they provide specifications and guidance to protect the health and safety of Canadians or to safeguard the environment. Examples of standards incorporated by reference in federal regulations include such things as laminated safety glass used in glass enclosures and balconies—you'll be aware of some court cases regarding the use of laminated safety glass—leak detection in fuel tanks, storage and transportation of explosives and dangerous goods, or the certification of organic foods.

In addition to those federal departments, there are thousands of referenced standards in provincial regulations. When you add in the standards referenced in Canada's model codes—and those model codes are the building, fire, and energy codes—you begin to comprehend the magnitude and consequences of the issues being addressed by this bill today.

There are now eight standards development organizations accredited by the Standards Council to develop standards in Canada. To maintain that accreditation, they must develop standards through a formal, rigorous process that is based on internationally accepted guidelines, including the World Trade Organization's code of good practice. That's a process that promotes open, transparent, and inclusive standards development. This is important to understand as you consider the ramifications in this bill.

The first step of the process is to create and maintain standards development committees that consist of a balanced matrix of representatives from affected stakeholder groups. That means that those people represent a combination of interests, expertise, perhaps even countries or regions. The valuable point at this stage, as you understand, is that no single group can dominate the agenda nor decide the outcome of the standard. Content is developed by the group through consensus.

Once consensus is achieved, the draft document is posted for public review and comment. Every comment must be examined and resolved by the technical committee; therefore, the outcome is much more accepted than if the rule were drafted by one group alone.

In addition, the developer of these standards is required to assess the need for revisions to the documents at least once within a five-year period. Many standards are in almost constant review and revision.

Federal regulators are among the experts participating in standards development committees. They're an integral part of the balanced matrix of interest that I mentioned. To give you a sense of scale, there are probably close to 365 federal government employees who actively participate in the development of just international standards. Those international standards are at ISO, the International Organization for Standardization; IEC, the International Electrotechnical Commission; or ITU, the International Telecommunications Union. That's just at the international level. Many hundreds more also participate in specific Canadian standards development activities for hundreds of standards that find their way into regulations.

Standards developed by either Canadian or international organizations can be submitted to SCC for approval as national standards of Canada. National standards of Canada provide regulators with clear confirmation, a stamp of approval you might add, that Canadian conditions and requirements have been appropriately considered. For a standard to become a national standard of Canada, public consultation with Canadians is required. NSCs must be made available in both official languages.

Although it is clear that many standards are incorporated by reference in federal regulations, our concern is that we've noted many challenges and inconsistencies in the methods by which incorporation by reference is currently being employed. Both the static and ambulatory methods of incorporation are currently being used. Both have merits in their own right. Unfortunately, we believe that the rationale and approach to a selection of a method of incorporation are not always understood or consistently applied by departments.

Each method has certain particularities which should be evaluated in the context of the rationale for citing that reference. For example, an important consideration would simply be, did the regulator participate in the technical committee of the standard in question?

For these reasons, and I'd like to support the earlier speaker, we believe that a government-wide policy or guideline, probably by Treasury Board, that provides guidance to regulators on the appropriate considerations is needed. We have witnessed first-hand the many benefits to Canadian regulators of using the drafting technique of incorporation by reference. For example, they leverage existing credible infrastructure without incurring additional costs, resources, or time.

But for the system to work, we believe that the references to standard and federal regulations need to be up to date and that standards used by regulators across jurisdictions need to be aligned when possible. This isn't just an issue for the Government of Canada. It's an issue for the 13 provincial and territorial governments.

Aligning regulatory requirements to regional or international standards is a way for regulators to establish compliance requirements without introducing additional red tape. That's because Canadian industry certifies many products to regional or international standards in order to access global markets.

In addition, referencing the latest available version of a standard in a regulation can contribute to higher levels of protections for Canadians. That's because new standards as a rule set the bar higher in terms of safety and performance.

In conclusion, it is evident to us that standardization represents a necessary and valuable complement to Canada's regulatory framework. Standards must be updated on a regular basis to reflect rapid changes in technologies, markets, and safety requirements. Therefore, it makes sense to equally modernize Canada's legislative framework to ensure that references to standards in federal regulations are accurate and reflect the latest available edition.

That's why we support this bill.

Thank you.

[The Chair, Conservative, Mike Wallace]

Thank you for that presentation from the Standards Council of Canada.

Our next presenter is from the Canadian Council of Criminal Defence Lawyers.

The floor is yours, sir.

[Ian McCuaig, Lawyer, Canadian Council of Criminal Defence Lawyers]

Thank you.

Good afternoon, Chair, and members of the committee.

I am here today as a representative of the Canadian Council of Criminal Defence Lawyers.

The council was formed in November 1992 to offer a national voice and perspective on criminal justice issues. Since the organization's inception, the council has intervened in important cases before the courts of this country, has been invited by the federal government to consult on major pieces of criminal legislation, and has been often asked by the media to comment on current issues.

Our representatives have appeared before the Senate Standing Committee on Legal and Constitutional Affairs, the House of Commons Standing Committee on Justice and Human Rights, and the Standing Committee on Public Safety and Emergency Preparedness.

The current board has representatives from all ten provinces and three territories.

On behalf of the council, I would echo support at least for the spirit of Bill S-2, but I am going to go on and explain a possible concern from a criminal justice point of view.

I consulted a little bit with some of the more accomplished criminal justice lawyers before I came to make this appearance and I can tell you, not very many criminal justice lawyers spend a lot of time thinking about incorporation by reference. However, that doesn't mean that it's not an important and actually really interesting issue from a criminal justice perspective.

Looking at the existing act, if you read the preamble it says:

An Act to provide for the examination, publication and scrutiny of regulations and other statutory instruments

From a criminal justice point of view, that's an important function that this act has, because if you're going to hold people accountable, they have a right to know the law. One of the functions of the Statutory Instruments Act is that it lets people know the law. It gives scrutiny to regulations and it stipulates that they be published in certain ways.

Furthermore, it goes on in section 17 of the existing act to specify the rights of access. It specifies that people have a right to both inspect and obtain copies of regulations.

There is also noted in the act exceptions to the process for making regulations, in section 20, which explains exceptions for publication and different mechanisms for oversight. But even the exceptions provided for by section 20 have oversight because those exceptions have to be defined in the regulations to the Statutory Instruments Act.

What we have is an act that provides for some oversight of the development of regulations. It provides that people will be aware of those regulations once they're developed. The thing is that a lot of the regulatory offences that are defined are defined by regulations, either fully or at least partly.

When you look at the amendments, a combination of a few of them together creates an interesting effect, especially in proposed section 18.1 of the bill, which allows for an ambulatory incorporation by reference.

Proposed sections 18.3 and 18.4 ensure that these documents will be accessible, but it allows that they not be published in the Canada Gazette, which is the normal way that regulations are publicized.

Proposed section 18.6 actually creates an interesting exception. It limits the liability for offences related to incorporated materials if those materials are not accessible. A lot comes down to this word “accessible”, but it doesn't seem to be really adequately defined; in fact, it doesn't seem to be defined at all. So we actually now have a built-in excuse where ignorance of the law is an excuse, but we don't really have a standard for what constitutes whether a person was made aware of the regulation or the incorporated document. This obviously could wind up in front of a court with an argument over what constitutes “accessible”.

Also raised in the legislative summary and some of the debate that's occurred on this already is the notion that there doesn't seem to be a requirement for incorporated documents to be available in French as well as in English. Normally, regulations must be published in both languages. For incorporated materials it doesn't seem that requirement exists.

The other thing is, in a normal regulation-making process, for the translations, obviously, there's quality control, so that we can be sure the French and the English versions are consistent. In a document that does exist that's incorporated by reference and that's available by a third party, there is really no oversight that the French or English or possibly other language versions will have the kind of consistency that a regulation has.

Current practice includes incorporation by reference of documents that are actually published by organizations outside Canada. I've brought along an example for you. The ozone-depleting substances regulations, published pursuant to the Canadian Environmental Protection Act, incorporate the following definition:

“Protocol” means The Montreal Protocol on Substances that Deplete the Ozone Layer, published by the United Nations Environment Programme....

The regulations go on in part 1, controlled substances:

This Part applies to (a) a controlled substance within the meaning of the definition in paragraph 4 of Article 1 of the Protocol, as clarified by Decision I/12A, as amended from time to time;

It's incorporated on an ambulatory basis.

Section 4 of the regulations says:

No person shall import or export a controlled substance from or to a State that is not a Party.

If you go back to the Canadian Environmental Protection Act, section 272(1) creates an offence. That offence has consequences that start in the tens of thousands of dollars and goes up to the millions of dollars and can result in years, in some cases three years, in prison.

What we have is a regulatory offence created through regulation, which incorporates a document that is published by an organization that exists outside of Canada completely beyond the oversight of the Canadian government.

Obviously, in the case of something like the Montreal Protocol, there are some clear advantages to that. This is a well-known organization, the UN, and this is an example of international treaties that have been successful. This is the hallmark of international treaties and there's really little reason to doubt the quality of the work these people do.

But we live in a world where we are negotiating more and more international agreements on more and more subjects. We're negotiating agreements on trade, the environment, and all kinds of things. To give you an example, if you follow in the press the development of the Trans-Pacific Partnership—and there's not really a lot of, I think, reliable information about it—there's a suggestion that it might be required, if we were to sign onto it and other countries sign onto it, to implement sanctions against the breaking of digital locks.

We might have a situation where we create an offence relative to a negotiated trade agreement and that offence again is related to a document that is beyond the control of the Canadian government. As you can see with the Montreal Protocol, it's implemented on an ambulatory basis, and I think that's a reason to just pause for a minute and take some concern. The legal principles that you might run up against in a case like that are the rule of law, which suggests that we should establish a normative order of clear principles for people to follow.

Section 7 of the charter suggests that ambiguity in the law is a problem, and from an administrative law perspective you could run up against the principles of procedural fairness with a situation like that.

Those are my remarks.

Thank you.

[The Chair, Conservative, Mike Wallace]

Thank you for those comments.

We'll now go to the round of questioning.

We're going to start with the New Democratic Party.

Madam Péclet, the floor is yours.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

Thank you, Mr. Chair.

I want to thank the witnesses for coming to enlighten us on all this.

My first question is for you, Mr. Walter. According to the simultaneous interpretation, you said that standards developed by Canadian or international organizations can be submitted to SCC for approval.

Is that an obligation or simply an option? Are all incorporations of international standards into regulations submitted to SCC, or is that done only on a voluntary basis?

[John Walter]

Thank you, that's a good question.

No, it's a decision of the organization developing the standard as to whether they would go through our process and be designated a national standard of Canada.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

As I said, this is an example. If a legislative authority decided to adopt a piece of legislation, as in the example Mr. McCuaig gave, and incorporated legislation, should the international organization or the Canadian government come to you? Which authority should ask you for accreditation?

[John Walter]

Let me back up a little bit. It will always be the authority of the government department or the government that wants to use the standard. We have found that there are hundreds of standards adopted into federal regulation now from organizations all over the world. More and more, Canada is moving to international standards, so on the specific Canadian standards, the numbers are decreasing fairly rapidly because it doesn't help Canada's competitiveness to develop standards only for this country.

We accredited an additional four standards development organizations over the last three years in Canada. They are encouraged to have their standards go through the process to become national standards of Canada. But let's be clear; internationally, ISO, the International Organization for Standardization, standards are recognized around the world. They are accredited to a specific code of good practice. They are meant to be used around the world, but it will always be the authority of the department as to how those standards are used, whether they're used with or without revision. So the government never loses control regardless of how they're referenced in regulation.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

According to the report of the Standing Joint Committee for the Scrutiny of Regulations, the ambulatory incorporation by reference of international documents could result in certain regulations not being scrutinized by Parliament.

If international criteria were adopted, would there be a follow-up? For instance, if legislation from another Parliament was incorporated and was then subject to several amendments owing to changes of government, laws or criteria, would a follow-up be conducted? If that was incorporated in an ambulatory manner, all the amendments would also be incorporated.

Does the accreditation you provide apply to a specific standard at a given time or does it also include all the amendments made afterwards to those standards or legislation?

[John Walter]

You're absolutely right in that there are concerns whether it's an international standard...whatever document, any document that you've referred to. That's why we believe very strongly that there needs to be Treasury Board guidelines set up so that there are certain processes. All of this is happening already. Those standards are already being adopted one way or the other across the government. Our position is let's modernize the system but let's make sure the rules are in place so that if it is ambulatory.... And the questions you raised are absolutely correct. What is the process to ensure that we don't adopt an international standard that doesn't fit for Canada? There needs to be a process whereby the department that's going to adopt the standard perhaps has been involved internationally. That's possible; that's always through us. There are ways to ensure that the standard is referenced in regulations to Canada's advantage.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

Thank you very much.

My last question is for you, Mr. McCuaig, as your presentation really focused on the definition of the term “accessible”.

An accessibility criterion is being imposed on all legislative and departmental authorities, but no definition is provided. That is somewhat problematic.

If a department or a regulatory authority had the obligation to publish regulations incorporated by reference—ambulatory or not—would the fact that fees are charged hurt that accessibility criterion? Let's say you were pleading a case before a court. Would that negatively affect this accessibility criterion?

[The Chair, Conservative, Mike Wallace]

You have about 30 seconds to answer that question.

[Ian McCuaig]

The current act certainly already provides that the government can charge for access to scrutinize or for printed copies of regulations. The only question is that these documents that are incorporated by reference seem to be excused entirely. They have to be accessible, but we don't know what that means.

[The Chair, Conservative, Mike Wallace]

Mr. Calkins from the Conservative Party, the floors is yours.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

It might have been a translation issue, but I thought I heard Ms. Péclet, in her question to you, Mr. Walter, say that this bill would allow legislative changes to occur by incorporation by reference, and I would like some clarification. It is my understanding this legislation is the purview of Parliament, and the incorporation by reference would only be effective when it comes to regulations. I'm just wondering if I'm missing something here or if that was lost in translation somewhere.

Is there anybody here that can clarify that?

[John Walter]

I'm not an expert.

[Michel Girard, Vice President, Strategy, Standards Council of Canada]

Well, in terms of standards, yes, I've yet to see standards incorporated in the legislation. Standards are incorporated by referencing regulations.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

I appreciate that. I want to make sure that we actually understand what we're talking about at the table because this is actually something that's outside the purview normally of this particular committee.

Just for edification, to see if I have this right, without incorporation by reference, if Canada had ever wanted to change its regulatory environment to match something that an international governing body or council or standardization agency might have had, we would have basically taken a copy-and-paste approach into the regulatory approach, put it into part I of the Gazette, gone through the time period, and then put it into part II. That was how we would have changed the regulations, right?

Incorporation by reference is like the Internet. It creates a hyperlink from the regulatory body that's allowed through the legislation, as Mrs. Proud was talking about, with some of the legislation, and it hyperlinks right to a document that somebody else might be in charge of, which I think you, Mr. Walter, rightly pointed out, usually involves a very credible oversight. Usually Canadians are involved in all of these kinds of things, which improves the efficiency and efficacy of the regulatory process, yet it still goes through the gazetting process. Do I understand that correctly?

Mrs. Proud, is that how that would still work?

[Karen Proud]

Sorry, it would not go through the gazetting process if the document changed, but originally when you're incorporating something by reference into regulation, that original incorporation—

[Blaine Calkins, Conservative, Wetaskiwin, AB]

That original document would.

[Karen Proud]

—goes through the regulatory process as we see it today. The thing that changes is if you have a dynamic reference. Changes to that document do not.

[Blaine Calkins, Conservative, Wetaskiwin, AB]

This is why, when we click on a hyperlink some months after we've last gone to a website, sometimes the page that we thought was going to be there isn't there, and it's changed and it's been updated appropriately.

Do I have this correct? Is that how that works?