moved that Bill C-49, an act to amend the Canada Transportation Act and other Acts respecting transportation and to make related and consequential amendments to other Acts, be read the second time and referred to a committee.
Madam Speaker, there are special moments in a politician's life when we get to do something truly transformative.
May 16, 2017 was one of those moments for me. I had the great pleasure of introducing Bill C-49, the transportation modernization act, which will help bring our government’s vision of a state-of-the-art national transportation system to fruition.
This legislation breathes life into transportation 2030, a strategic plan for the future of transportation in Canada, to promote our government’s agenda for economic growth and job creation.
It fulfills our promise to review the Canada Transportation Act and related legislation. We want to ensure our laws and regulations position Canada to capitalize on global opportunities, thrive in a high-performing economy, and better meet the needs and service expectations of Canadians.
This bill represents a first legislative step to deliver on early Transportation 2030 measures. It consolidates into a single bill some of the essential components required to advance a strategic and integrated plan for our country’s transportation system.
Bill C-49 proposes a range of improvements to better meet the service requirements and overall experience of the Canadian traveller. It aims to create a safe, innovative transportation system that takes advantage of international best practices, opportunities for international investment and contributes to a highly productive Canadian economy.
Bill C-49 focuses on our immediate priorities in the air, rail and marine sectors. It addresses the needs of air passengers for fairer and more transparent rights, the needs of the Canadian air industry for greater investment, the needs of shippers for safer and more efficient rail transportation, and the needs of railways for strengthened trade corridors to global markets.
Specifically, the bill proposes to strengthen air passenger rights; liberalize international ownership restrictions for Canadian air carriers; develop a clear and predictable process for approval of airline joint ventures; improve access, transparency, efficiency, and sustainable long-term investment in the freight rail sector; and, increase the safety of transportation in Canada by requiring railways to install voice and video recorders in locomotives.
Before I explain each of these in greater detail, let me first make clear that action in these areas reflects the priorities identified by Canadians.
We undertook extensive consultations over the past year following the release of Canada Transportation Act review report. We heard from more than 300 Canadian transportation and trade stakeholders, including indigenous groups and the provinces and territories, about how to ensure that the national transportation system continues to support Canada's international competitiveness, trade, and prosperity.
We also heard from individual Canadians in communities, large and small, all across the country regarding their concerns about our transportation system. Canadians have expressed their disappointment with their air travel experiences. I am committed to improving those experiences.
The concerns of Canadians have been highlighted in recent weeks with much-publicized cases of the unacceptable treatment of air travellers both in this country and south of the border. Stories of passengers forcibly removed from flights and other unacceptable industry practices that have significant impact on consumers have made the news headlines.
The bill, if passed, would provide assurance to Canadians that if they choose to travel by air, they would be aware of their rights, and should they feel that their rights have been violated, they would have a clear, simple, and timely mechanism for resolution.
Bill C-49 proposes to mandate the Canadian Transportation Agency to develop, in partnership with Transport Canada, new regulations to enhance Canada's air passenger rights. These new rules would ensure air passenger rights are clear, consistent, and fair for both travellers and air carriers.
I believe that when passengers purchase an airline ticket, they expect and deserve the airline to fulfill its part of the transaction. When that agreement is not fulfilled, passengers deserve clear, transparent, and enforceable standards of treatment and compensation. Under this proposed legislation, Canadians would benefit from a uniform, predictable, and reasonable approach. The details of the new approach would be elaborated through the regulatory process, which would include consultation with Canadians and air stakeholders.
My objective is to ensure that Canadians have a clear understanding of their rights as air travellers without negatively impacting on access to air services and costs of air travel for Canadians. Bill C-49 specifies that the regulations would include provisions regarding the following: first, providing passengers with plain language information about carriers' obligations and how to seek compensation or file complaints; second, setting standards for the treatment of passengers in the case of overbooking, delays, and cancellations, including compensation; third, standardizing compensation levels for lost or damaged baggage; fourth, establishing standards for the treatment of passengers in the case of tarmac delays over a certain period of time; fifth, seating children close to a parent or guardian at no extra charge; and sixth, requiring air carriers to develop standards for transporting musical instruments.
I have been clear that I also intend that the regulations would include provisions ensuring that no Canadian is involuntarily removed from an aircraft due to overbooking. I have issued a challenge to Canada's air carriers on this matter, and that of seating arrangements for minors, that they move to strengthen their practices even before new air passenger rights are finalized.
The bill also proposes that data would be required from all parties in the air sector flow to be able to monitor the air traveller experience, including compliance with the proposed passenger rights approach.
The legislation also proposes to liberalize international ownership restrictions from 25% to 49% for Canadian air carriers, with associated safeguards. For example, a single international investor would not be able to hold more than 25% of the voting interests of the Canadian air carrier, and no combination of international air carriers could own more than 25% of a Canadian air carrier.
I should point out that the policy change would not apply to Canadian specialty air services, such as heli-logging, aerial photography, or firefighting, which would retain international ownership levels of 25%.
Liberalizing international ownership restrictions means that Canadian air carriers, which include all passenger and cargo providers, would have access to more investment capital, which they can use for innovation. This would bring more competition into the Canadian air sector, providing more choice for Canadians and generating benefits for airports and suppliers, including new jobs.
In fact, in the fall of 2016, I exempted from the ownership restrictions of 25% two companies that wanted to enter the Canadian market supported by increased foreign investment. This decision is now permitting Enerjet and Jetlines to pursue their intention to create low-cost carrier services for Canadians. Liberalizing the foreign investment provisions will give Canadians more frequent access to air travel within Canada, and from Canada to transborder and international locations.
Another improvement in the bill is that it proposes a new, transparent, and predictable process for the authorization of joint ventures between air carriers, taking into account competition and wider public interest considerations.
Joint ventures are a common practice in the global air transport sector. They enable two or more air carriers to coordinate functions on specific routes, including scheduling, pricing, revenue management, marketing, and sales.
In Canada, air carrier joint ventures are currently examined from the perspective of possible harm to competition by the Competition Bureau.
Unlike many other countries, notably the United States, Canada's current approach does not allow for the consideration of the wider public interest benefits other than competition and economic impacts. Furthermore, the bureau's review is not subject to specific timelines.
The bill that is before this House proposes amendments that would allow me to consider and approve air carrier joint ventures, where it is in the public interest, taking into account competition considerations. On this latter concern, I would work in close consultation with the Commissioner of Competition to ensure that I am properly informed regarding any concerns that he or she may have with regard to competition. Air carriers that would choose to have their proposed joint ventures assessed through the new process would be given clear timelines for an expected decision.
I am also convinced that providing Canada's air carriers with such a tool would also benefit the air traveller. By joining up networks, air carriers could allow seamless travel to a wider range of destinations and reduce the duplication of functions. For Canadians, this could mean more seamless access to key global markets, easier in-bound travel in support of tourism and business, as well as increasing transiting traffic through our airports, thus increasing flight options.
Globally, airports are making investments in passenger screening to facilitate passenger travel and gain global economic advantages. Canada's largest airports have expressed an interest in making investments in passenger screening, either through additional workforce or technology innovation, and smaller airports have shown interest in obtaining access to screening services to promote local economic development. In the last two years alone, 10 small airports across Canada have requested screening services.
The proposed amendments in the bill would create a more flexible framework for the Canadian Air Transport Security Authority, known as CATSA, to provide new or additional screening services on a cost recovery basis. This would enable industry stakeholders to enter into agreements with CATSA to increase access to screening services at small, low-risk airports.
In turn, this would support our efforts to maintain an aviation system that is both secure and cost effective. It would also strengthen Canadian communities' competitiveness as they attract new commercial routes.
Bill C-49 proposes significant enhancements to increase the safety of the rail sector, too. Once in place, this legislation would build a safer, more secure rail transportation system that Canadians trust.
As a top priority, the legislation would amend the Railway Safety Act to require that railway locomotives be fitted with voice and video recorders. Mandating the installation of the recorders would strengthen rail safety by providing objective data about crew actions leading up to, and during, a rail accident. Beyond that, the requirement would also increase opportunities to mitigate risks and prevent accidents from occurring.
The updated act would not only require companies to install the recorders. It would limit how the recorded data could be used, within strict criteria. For instance, while the Transportation Safety Board would have access to recorded data for post-accident investigations, Transport Canada and railway companies would also have access to the data for proactive safety management, and for following-up on incidents and accidents not investigated by the Transportation Safety Board.
The specific limits on the use of the data are designed to maximize the safety value of this technology while limiting its potential to infringe on employees’ privacy rights.
Canada's freight rail system is a cornerstone of our economy. Bill C-49 would strengthen the freight rail policy framework to foster greater transparency, balance, and efficiency in the Canadian rail system. The proposed improvements would provide fair access through stronger remedies for shippers on service and rates, promote increased efficiency of the rail transportation system, encourage long-term investments in the railway network, and deliver improved data on rates and service.
As I committed last fall, fair access measures would allow for reciprocal financial penalties in service-level agreements to ensure that railways are held accountable for service failures. They would improve access to and end the timelines of the Canadian Transportation Agency processes to settle service and rate disputes. The new measures would ensure the agency offers informal dispute resolution options and guidance to shippers. The legislation would also broaden eligibility for rate remedies, benefiting small and medium-sized shippers, and allow an arbitrator's decision to apply for two years instead of only one.
We would also create a new mechanism called long-haul interswitching. This would be available to all captive shippers in all regions of the country and all sectors. It would introduce competitive alternatives for their traffic and better position them in negotiations for service options and rates. Other measures would modernize the methodology to calculate the maximum revenue entitlement in order to promote long-term investments in the rail system. Among other things, these improvements would better recognize railway investments, including in hopper cars.
The bill would also make it easier for the agency to update regular interswitching rates so that they adequately compensate railways for interswitching costs. As well, Canadian National's single shareholder restrictions would be relaxed from 15% to 25%.
To enhance transparency and level the playing field, the amendments would require large railways to report some performance, service, and rate data relevant to their Canadian operations. Transport Canada would have the authority to publicly report rate trends.
In the context of these advancements for the freight rail system, the short-term measures in the Fair Rail for Grain Farmers Act would be allowed to sunset as scheduled. With Bill C-49 we are taking important steps to ensure that the right conditions are in place for a successful winter season in the grain handling and transportation system this year and for years to come.
These are not the only ways we propose to improve trade and global markets. Bill C-49 would also amend the Coasting Trade Act to enhance marine transportation as well.
The proposed amendments would allow vessel owners to reposition their owned or leased empty containers between locations in Canada using vessels of any registry. This is something the Shipping Federation of Canada began asking for as far back as 2009. Extending the repositioning of empty containers to all ship owners would support industry's request for greater logistical flexibility and also would help address the ongoing shortage of empty containers for export purposes.
Equally important is Bill C-49's focus on marine-related infrastructure. The legislation proposes amendments to the Canada Marine Act that would allow Canadian port authorities and their wholly owned subsidiaries to access Canada infrastructure bank loans and loan guarantees. As members are aware, the bank would be responsible for investing in key infrastructure projects. Enabling port authorities to access the bank would support investments in key trade-enabling infrastructure, creating the conditions for companies and communities to build, expand, and thrive.
I am proud to table Bill C-49, the first legislative step toward making Transportation 2030 a reality. I trust I can count on the support of all parliamentarians to seize its immense potential, and to pass these measures as soon as possible.