Evidence of meeting #119 for Transport, Infrastructure and Communities in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was shipping.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Natasha Rascanin  Assistant Deputy Minister, Transformation, Department of Transport
Marc-Yves Bertin  Director General, Marine Policy, Department of Transport
Julie Gascon  Director General, Operations, Canadian Coast Guard, Department of Fisheries and Oceans
Marc Sanderson  Acting Director General, National Strategies, Canadian Coast Guard, Department of Fisheries and Oceans
Matt Jeneroux  Edmonton Riverbend, CPC
Rear-Admiral  Retired) Peter Ellis (Executive Director, Clear Seas Centre for Responsible Marine Shipping
Sonia Simard  Director, Legislative and Environmental Affairs, Shipping Federation of Canada
Robert Lewis-Manning  President, Chamber of Shipping

9:25 a.m.

Marc Sanderson Acting Director General, National Strategies, Canadian Coast Guard, Department of Fisheries and Oceans

There are about four different elements of division 22 that are worth mentioning, very briefly.

One is, to your question, clarifying the lead federal agency in spill response and incident response. That's what's contemplated in these amendments, to make it clear, if necessary, that the Coast Guard's direction and orders supersede those of any other federal agency.

The primary element of these amendments is removing ambiguity about when the Coast Guard in particular could take action. There's not a material change in the role of a shipowner or in the role of the Coast Guard. This is, rather, about increasing some options from our proactive response. There's no limitation necessarily now to wait until there's a likely discharge of a pollutant into the water, but rather, a discharge that may occur. In that threshold, there's a significant difference in the ability of the Coast Guard to respond and/or the shipowner, which, of course, is always the preferred option and the underpinning of our polluter pay principle here in Canada.

There are a couple of other amendments that speak to crossing over private lands, if necessary, to effect an immediate response, as well as extending immunity to people who advise the Coast Guard and our partners, including shipowners, response organizations and others, to make sure that we can mount the best response for each individual incident. That's what, I think, is the most important thing, that each incident has its own specifics, and my colleague spoke earlier about all the different variables at play.

Of course, what I'd like to say is this really allows us to right size the Coast Guard's response to a situation. We can scale it up or down as needed, but the important thing is that we're there as soon as possible assessing things and making the right decisions with the right parties involved. As I say, it's always with the shipowner or polluter, in this case, or potential polluter, to make sure that we prevent any damage to the marine environment.

9:30 a.m.

Liberal

Vance Badawey Liberal Niagara Centre, ON

I will go back to my initial question, Mr. Bertin, with respect to the reserve.

Is there a process after the fact that the different agencies, including the municipalities, would make application to access that reserve for compensation?

9:30 a.m.

Director General, Marine Policy, Department of Transport

Marc-Yves Bertin

Absolutely. Right now, the process exists. People apply and their claims are assessed.

What this statute would do is actually institute a fast track system to ensure that the monies are put in the hands of people and organizations that need them as quickly as possible. What we're looking at is basically a claimant being able to seek compensation from the Canadian fund through a lightened attestation process. They would need some basic criteria, just the facts around the fact that they've suffered a damage or a loss of some form and be able to attest to the fact that they have supporting documentation, if needed, to prove that claim. Basically, for under $35,000, people could avail themselves of this mechanism.

9:30 a.m.

Liberal

Vance Badawey Liberal Niagara Centre, ON

Good.

Thank you.

9:30 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much.

Next is Mr. Jeneroux.

9:30 a.m.

Matt Jeneroux Edmonton Riverbend, CPC

Thank you, Madam Chair.

I just wanted to ask a question for anyone at the table.

Did you do an industry sensitivity analysis on how changes to the Marine Liability Act would impact the small local shippers?

9:30 a.m.

Director General, Marine Policy, Department of Transport

Marc-Yves Bertin

With respect to shippers, we are not, in this statute, proposing to change their liability level. Ostensibly, their liabilities are set under international convention. Where Canada has an opportunity to tweak its regime is with respect to its domestic fund, and the domestic fund, of course, is sourced from the importers and exporters of oil products. From that perspective, there is no impact on the shipping community.

9:30 a.m.

Edmonton Riverbend, CPC

Matt Jeneroux

We have a three-hour meeting today. I encourage you to stick around and listen to the testimony of the—I think there are at least five—stakeholders coming up. Quite honestly, I think you'll hear something different about what you're assuming you did in terms of your consultation. We're hearing extensively—and to be honest, that's why you're hearing a line of questioning from our side of the table—that not a lot of people feel they've been consulted. For you to sit here and say that you've consulted time and again I think only frustrates and irritates those stakeholders even more. I'd encourage you to stick around, but also, to consider potential amendments they may be proposing to some of the legislation when it comes forward.

Again, a bunch of stakeholders out there are quite upset with the process that has occurred. For you, Ms. Rascanin, to say that the consultation ended on Friday and that all of it was considered in terms of this legislation.... Quite honestly, you can't possibly be serious that that's the case.

Again, thank you for being here, but I sure do hope you stick around and hear the testimony from the rest of the witnesses today.

9:30 a.m.

Liberal

The Chair Liberal Judy Sgro

Mr. Aubin.

9:30 a.m.

NDP

Robert Aubin NDP Trois-Rivières, QC

Thank you, Madam Chair.

I want to thank Ms. Rascanin and her team for trying to find an initial answer to my question. However, I must admit that I'm not sure whether I fully understood it. I'll need some clarifications.

You said that the amendments to the act proposed in this bill would give the minister new regulatory powers so that he can act more quickly in a given situation. However, I'm looking for information in the bill indicating that the victims in Yamachiche, for example, could have access to the type of compensation fund available to victims of an oil or hydrocarbon spill.

For instance, could we add victims of a marine incident to the list of people who can register for or request compensation? The victims' issues aren't resolved by the fact that the minister has additional regulatory powers that enable him to act more quickly to impose certain practices, as he did in the case of the restrictions concerning whale movements. The incident occurred. The question is what to do next.

In short, would the minister's regulatory powers enable victims to receive compensation?

9:35 a.m.

Assistant Deputy Minister, Transformation, Department of Transport

Natasha Rascanin

Thank you for the question.

The regulatory authorities are focused on marine safety and environment risks and being able to act in critical, unforeseen situations. What I was talking about is in that regard.

9:35 a.m.

NDP

Robert Aubin NDP Trois-Rivières, QC

Thank you.

In this case, clearly the new regulatory powers have no impact in a situation such as the one that I described. I regret, once again, that this situation wasn't taken into account. It happened once in my area and we don't want it to happen anywhere else. However, given the growth of marine transportation, we can't think that nothing of this nature would happen in Canada.

The review of the act must make it possible to resolve this issue. We've missed the mark yet again.

I'm still concerned about the fact that we need to provide a response by Friday, even though the consultations aren't over. Some people believe that they haven't been sufficiently consulted. I look forward to hearing from the witnesses who will be appearing over the next two hours. I'm wondering whether these people, who are directly affected by the two acts on a daily basis, had the time to respond after the budget was tabled. If they tell me that they haven't had time to respond, I'll be even more concerned.

I'll stop here for now.

Thank you, Madam Chair.

9:35 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much.

We will end this section of the meeting and excuse our witnesses, and then invite the others via video conference and so on.

I will suspend for a few minutes.

9:40 a.m.

Liberal

The Chair Liberal Judy Sgro

I'm calling the meeting back to order.

For this session we have, from the Chamber of Shipping, Robert Lewis-Manning, the President. From Clear Seas Centre for Responsible Marine Shipping, we have Peter Ellis, Executive Director, by video conference. From the Shipping Federation of Canada, we have Sonia Simard, Director, Legislative and Environmental Affairs.

Welcome to all of you.

Mr. Ellis, why don't we start with you for five minutes.

9:40 a.m.

Rear-Admiral Retired) Peter Ellis (Executive Director, Clear Seas Centre for Responsible Marine Shipping

Madam Chair and committee members, thank you for giving me the opportunity to speak to you today.

Clear Seas Centre for Responsible Marine Shipping is an independent not-for-profit organization that sponsors research and produces communications and engagement programs related to sustainable marine shipping in Canada. We were launched in the summer of 2015—so we're about three years old—with seed funding from Transport Canada, Alberta Energy and the Canadian Association of Petroleum Producers.

Our purpose is to provide impartial, reliable and evidence-based information on shipping in Canada on the premise that better information leads to better decisions. Our independence is protected in our funding agreements and all of our program is accessible on our website at www.clearseas.org.

My observations today are based on some of the work we've done through our research and website publications, engagement with stakeholders, participation in many forums and working groups related to marine shipping, and of course observations from media and social media. I offer that the importance of marine shipping to our well-being and prosperity is underappreciated by most Canadians. To gauge Canadians' attitudes toward marine shipping, we conducted a public opinion poll in partnership with the Angus Reid Institute in the spring of 2016. We've just completed another round of polling on Canadians' attitudes to see if there are any trends. The data is currently being analyzed, and we aim to publish the results by the end of November.

A common theme raised in the 2016 poll and that persists today is the concern Canadians have for the potential environmental impacts of shipping. The proposed legislative changes are clearly aimed at enhancing confidence in and effectiveness of what is already a sound system.

Clause 689 of Bill C-86, for example, in providing the explicit authority of the minister to enter into agreements with indigenous groups, stakeholders and other levels of government clearly recognizes the complexity of the marine environment, its many jurisdictional interfaces, the issues of aboriginal rights and title, and the variability of local considerations. These realities are already recognized at the tactical level in such plans as the Canadian Coast Guard's greater Vancouver integrated response plan, for example. I suggest the development of such agreements should be subject to extensive engagement with stakeholders.

The proposed authority of the minister to make interim orders in clause 690 of the bill is an application of the precautionary principle, allowing greater flexibility to respond to short-fuse developments. Notwithstanding the interim nature of the orders, these decisions should be evidence-based and consider the best information available at the time. Enhancing the flexibility to intervene earlier in the cases where pollution may occur, but has not yet occurred, supports more timely action, which is a key element of effective response. Potentially preventing already rare pollution incidents or containing such events more swiftly to limit the spread of a spill are important elements of reducing risks associated with shipping. Likewise, the authority to enter private property and use private property in a response scenario is likely to improve effectiveness.

The provision of immunity for persons providing assistance, bounded by what is reasonable in the circumstances, is supported. It should be noted that this change may alleviate some concerns that have been expressed by American response personnel with regard to their liability in potential transborder operations. The changes to administrative and monetary policies applied judiciously will clearly support the polluter pays principle and enhance public confidence, which has been undermined somewhat by lengthy and inconclusive proceedings such as those following the Marathassa spill.

The changes to the ship-source oil pollution fund are also likely to increase confidence in the system by broadening the scope of what can be compensated. While extending the compensation available to economic loss indirectly related to pollution incidents makes sense and is consistent with the polluter pays principle, it raises significant questions as to the impacts on insurance rates, civil liabilities and other effects. These need to be clarified and clearly understood.

For some this change will not go far enough, as a portion of the population believes that compensation ought to extend to such areas as the loss of use of public land for recreational, cultural or other reasons.

Clear Seas supports the provisions of this bill, but notes that additional engagement with stakeholders is required as this bill moves forward.

I would also note that the focus seems to be on the response phase, with little being added to the preventive pillar.

Thank you again for giving me the opportunity to participate in this meeting.

I'm now ready to answer your questions.

9:45 a.m.

Liberal

The Chair Liberal Judy Sgro

We will now go to Ms. Simard from the Shipping Federation of Canada, for five minutes, please.

9:45 a.m.

Sonia Simard Director, Legislative and Environmental Affairs, Shipping Federation of Canada

Good morning. My name is Sonia Simard.

I am appearing today on behalf of the Shipping Federation of Canada.

Our objective is to provide the perspective of shipowners on some of the marine amendments contained in Bill C-86.

Although we are grateful for the opportunity to appear before this committee, we are indeed concerned with the very fast pace at which the bill is proceeding right now. Yesterday we submitted a brief to this committee in which we outlined some of our concerns with Bill C-86 and proposed some specific amendments.

More specifically, we recommended, first, that the marine transportation amendments be extracted from Bill C-86 and addressed as a stand-alone bill in order to ensure that there is sufficient time to proceed with a proper examination of the proposal.

If this is not done, we would urge this committee to proceed, at a minimum, with some specific amendments. Today we are addressing, more specifically, division 22 of Bill C-86.

That division provides the minister and the Governor in Council with additional powers in relation to regulation for protection of the environment. The shipowners and vessels we represent are committed to safe and sustainable transportation, so our concerns with the proposals are not with the objectives. We support the objectives, but we are asking for specific amendments to ensure that we have the proper safeguards around the new powers that are proposed.

Going into a little bit of detail, clause 690 of Bill C-86 would enable the minister to issue interim orders in the marine mode for any type of risk to marine safety or the marine environment that he or she views as requiring immediate action. These orders could remain in effect for up to three years without any of the basic safeguards provided in the normal regulatory process, such as consultation with affected stakeholders or regulatory impact statements that we do when we have regulations.

In our opinion, the proposed framework for interim orders in the marine mode is much broader than what we have found in other Canadian legislation. We have more detail in our brief, but just to make a summary of the common features we have seen in other Canadian legislation, usually ministerial interim orders are for a type of risk that meets a threshold, and that threshold is generally “significant risk” or “immediate threat”.

Furthermore, the lifetime duration of an interim order in the legislation we have seen is more tightly constructed. Those ministerial orders can stand alone for 14 days, after which time the Governor in Council must approve such interim orders and then extend the power by either one year, as we see in most of the legislation, or two years, as we see occasionally.

When we looked at the interim order framework being proposed here, we found it to be much broader. That's why what we have proposed is not an objection to the interim order, but rather, specific amendments to ensure that we find the proper safeguards around those interim order powers.

The second element we have outlined in our submission relates to clause 692 of the bill. I believe you have discussed this with the witnesses before. That's the power of the minister to vary Governor in Council recommendations. Again, we find powers to vary a regulation outside of the normal regulatory process. Because of the same concerns I have mentioned, we have also in our bill proposed specific amendments to ensure that we have proper safeguards.

The issue here is not whether or not there is a need to act fast. We understand that those situations happen. We just want to make sure we have proper safeguards around those powers.

On the other elements, we have brought more comments on division 22, but as we are running out of time, I'll ask you to refer to them in our brief.

The one point I would like to make in finishing is the fact that we unfortunately haven't been able to fully review the proposed amendments to the Marine Liability Act, but we will continue our review and we intend to submit comments in front of the Senate.

Thank you for your attention.

9:50 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, Ms. Simard.

Next is Robert Lewis-Manning.

9:50 a.m.

Robert Lewis-Manning President, Chamber of Shipping

Good morning, Madam Chair and members of the committee. I appreciate the opportunity to offer observations and early recommendations that pertain to certain sections of the most recent budget bill tabled last week.

The chamber has worked closely with government, coastal communities and other stakeholders on most aspects of the oceans protection plan, including critical work associated with protecting species at risk and the numerous conservation initiatives currently under way.

You are well aware, particularly after your recent committee trip to British Columbia, that marine transportation is critical to supporting Canada's international trade, and that a safe, competitive and predictable operating framework is good for Canadians, the Canadian economy and the many industries that drive that economy and rely upon marine transportation.

I'll speak to four elements of the proposed legislation, and some of it will be repetitive, namely the three that refer to authorizations under the Canada Shipping Act. I have more general comments with respect to the Marine Liability Act.

With respect to the Canada Shipping Act, Bill C-86 amends the act, and explicitly provides the authorization for the administration and enforcement of the act to other levels of government, including provinces and indigenous groups. If there is intent to delegate authorities to a province, for example, we would be concerned about the capability of a delegated authority to fulfill such a complex mandate and the increasing potential for a patchwork approach to administering Canada's supply chain.

The oversight of Canada's supply chain is managed nationally by the federal government, because it is complex, and there is a high degree of integration and reliance across transportation modes. This helps to ensure a predictable and competitive environment for Canadian businesses.

The draft bill also authorizes regulatory powers to protect the marine environment. This makes sense, and we understand and support the intent of this regulatory power. Notwithstanding that, we also have reservations about its implementation and the potential for associated regulations conflicting with Canada's commitment to international conventions, such as the United Nations Convention on the Law of the Sea. This may have also been a lost opportunity for seeking additional regulatory powers such as those to designate anchorages, not just regulate or prohibit such operations.

We have significant concerns about the regulatory power to prohibit the loading and unloading of a vessel, as it already exists under the Canadian port state control regime. It appears to be another mechanism with which to implement a moratorium on specific commodities through regulations or an interim order, and contradicts the objectives of providing a predictable supply chain.

Bill C-86 also authorizes the minister to make interim orders. Overall, this also makes sense, and there are many examples of when it could have been employed in the past. However, in its current form, this authority lacks appropriate guidance to the minister on its use, and has requirements to consult with other ministers on the science justification, for example.

In both cases of these relevant clauses, 690 and 692, there needs to be a requirement for compelling evidence and/or science that ensures that such regulations or interim orders are sensible, and that such action will not have adverse consequences to marine safety or marine protection.

With respect to the Marine Liability Act, Bill C-86 provides for changes to liability of the ship-source oil pollution fund for economic loss when property has not been impacted, creating a potentially unmanageable situation where claims for pure economic loss lack any sensible limits or guidelines.

The potential for unsubstantiated claims of pure economic loss could increase the exposure of the fund, and consequently the exposure of shippers, receivers and carriers, and potentially the economy as a whole, if the fund has to absorb that cost. Ultimately, this may not address the challenge it is aiming to resolve, and could result in increased costs, making Canada's supply chain less competitive. We just don't know at this point.

We believe that this aspect of the bill has not been subject to any consultation, could have significant and long-lasting impacts, and therefore should be delayed and properly examined. Despite our specific concerns that I've already mentioned, we acknowledge the positive amendments designed to enhance the flexibility to and timeliness for intervening when a pollution incident may be possible or imminent.

Commercial marine transportation depends on a predictable, global regulatory framework in order to plan and deliver a safe, reliable, responsible and cost-effective transportation solution. As Canada progresses with improvements to its pollution response, compensation and liability regimes, it should recognize that major changes to this regime need thorough analysis, dialogue with stakeholders, especially regulated industries, and sufficient time for protection and indemnity providers—insurers—to evaluate increased levels of exposure.

Marine transportation providers come in all shapes and sizes. There are numerous small Canadian commercial operators that may not even be aware of the changes as proposed, let alone be in a position to abide by them in short order and without the appropriate time to review their own operations and commercial practices.

Thank you, Madam Chair.

9:55 a.m.

Liberal

The Chair Liberal Judy Sgro

Thank you very much, Mr. Lewis-Manning.

Ms. Block.

November 6th, 2018 / 9:55 a.m.

Conservative

Kelly Block Conservative Carlton Trail—Eagle Creek, SK

Thank you very much, Madam Chair.

I do thank our witnesses for joining us. It's very important that we hear from you today on the proposed legislation that is before us in the second budget implementation act.

I take very seriously the concerns that you've raised around the very tight timelines and the fact that this legislation is part of a budget bill. It echoes, perhaps, our disappointment on this side of the table, given some of the signature pieces of the transportation strategy that the minister has outlined, such as the oceans protection plan, which this is apparently part of. We know that the minister has a 2030 strategy when it comes to transportation, and there is our own undertaking of a Canadian transportation logistics strategy study. It's a very lengthy and, I think, expensive endeavour that we have undertaken to go across the country to understand some of the challenges that are facing our transportation system.

I'm not sure whether my colleagues on the other side are as disappointed as we are in terms of something as significant as these changes, these substantial changes—and those are the words of the deputy minister—that have been made to the Canada Shipping Act, 2001 and the Marine Liability Act.

What I would ask you to comment on is, perhaps, how the process has unfolded for you, Mr. Lewis-Manning. I know that Ms. Simard already provided her comments on that. Further, would you expand a bit more on clause 692 and how this clause impacts the shipping industry in British Columbia? I'm wondering if you can give an example of how this will impact the shipping industry as a whole and how it will impact Canadian competitiveness.

10 a.m.

President, Chamber of Shipping

Robert Lewis-Manning

I have a short response with regard to the consultation. Consultation does happen continuously. In having listened to departmental officials, yes, there has been dialogue over the last two years on a lot of different issues. I don't think any of us really saw that it was coming to a legislative amendment so quickly, or we probably would have focused our energy differently. That's to say there's a lot going on. There's a lot that's happening for the departments, and I think we're all feeling the pressure of death by consultation, to be quite honest.

We do this full time. There are a lot of people who do it part time who would never have any idea that some of these changes are in the making.

In answer to your question about clause 692, the powers to protect the marine environment, it's difficult to speculate what it might impact. As far as regulatory powers are concerned, obviously anything that goes through a regulatory process has consultation built into it. I don't want to speculate that this could be very negative. In fact, there are probably a lot of situations where regulating for environmental reasons makes sense. In practicality, it's how it's done and what evidence and science feeds into it. That's a relatively new space for both the industry and the government departments as a whole.

Every chance that it can be a deliberate process, and with the right investment in resources for a positive outcome, will be a good improvement. I don't want to make it sound like this is a risk.

If you take those same powers in an interim perspective, there's a lot that could easily go wrong quickly. As you can imagine, we're not dealing with small powerboats. We're dealing with ships that are 300-plus metres long and weigh 180,000 tonnes. How they react and how they're regulated count, and there are no quick solutions.

We had a recent good example. Over the last year and a half, as I think everyone would know, everybody's been working really hard on the west coast to protect southern resident killer whales. From the science that came out of one department, one top recommendation was that we should be convoying these huge ships. Now you can imagine that when that landed on the desk of shipping professionals, we laughed. Our response was, “Why didn't you include us up front? We would have saved a year of time.” The Minister of Transport took the right action. We asked for a risk analysis, and he made it happen. We could have probably done that much more quickly if the right consultation process had been set up right from the beginning.

The details matter when it comes to the safety of shipping and its impacts on the environment.

10 a.m.

Conservative

Kelly Block Conservative Carlton Trail—Eagle Creek, SK

Thank you.

10 a.m.

Liberal

The Chair Liberal Judy Sgro

You have 30 seconds.

10 a.m.

Conservative

Kelly Block Conservative Carlton Trail—Eagle Creek, SK

Take those 30 seconds, Ms. Simard.