Mr. Speaker, we are here today to discuss Bill C-49, the transportation modernization act, which was passed by the Senate, with amendments, on March 29, 2018. I would like to thank the Standing Senate Committee on Transport and Communications for its dedicated study and thorough review of the bill, which led to a total of 27 amendments being proposed, of which 18 were carried.
The committee heard important testimonials from over 70 witnesses during 23 hours of hearings. The committee also received valued submissions from many other stakeholders during its diligent study of the bill. While there have been some differences of opinion, we have also heard how important this bill, as a whole, is to our economy, to the transportation system, and to Canadians. The government wishes to thank all stakeholders who actively contributed to the study of Bill C-49 and helped to highlight its benefits and importance to the Canadian transportation system.
Many groups spoke in support of this legislation, including but not limited to the Chemistry Industry Association of Canada, which testified to how pleased it was with Bill C-49, including its transparency and fair access provisions; the Canadian Association of Railway Suppliers, which stated during its testimony that it believes Bill C-49 would encourage investment in the grain handling system; the Alberta Wheat Commission, which elaborated on the strong support Bill C-49 has among its 14,000 members; the Public Interest Advocacy Centre, which explained that the bill outlines clear and consistent standards of treatment and compensation for all air carriers; Metrolinx, which explained, on the subject of LVVR, that the bill strikes a balance between privacy and safety; and others, such as Alberta Wheat, Alberta Barley, the Canadian Federation of Agriculture, Grain Growers of Canada, Cereals Canada, and Soy Canada. Views such as these contribute to making Bill C-49 a transformational piece of legislation that strengthens Canada's transportation system.
The Senate's amendments touch on the different areas of the bill, and the government has taken the time to carefully review each proposed amendment.
The government supports the following two amendments. The first has to do with loosening foreign ownership restrictions and the reference to interests owned directly or indirectly. One of the bill's main objectives is to clarify things for air carriers and passengers. That is why we support the Bill C-49 amendment about foreign ownership of air carriers. The proposed amendment clarifies restrictions on foreign ownership of Canadian air carriers by individuals or international air carriers.
The second amendment we support has to do with locomotive voice and video recorders and adding the notion of destruction. Although the notion of destruction of information is implicit in the notion of preservation as set out in this clause, the amendment would further clarify the regulatory authority. This will address any concerns about making sure the regulations provide for the destruction of information once companies are no longer required to preserve it. This amendment is acceptable as passed because it makes the clause clearer.
The government also supports, with amendments, three other amendments.
The first is called “own motion”. It is important to recognize that the freight rail measures in Bill C-49 currently strike a delicate balance between the needs of shippers and those of railways. Any changes must be carefully considered in order to ensure that this balance, and the long-term economic viability of the rail network, is maintained. That said, we have heard the calls from shippers of different commodities across the country about the need for the Canadian Transportation Agency to be able to conduct investigations into rail service issues on its own motion.
That is why we are proposing an amendment that would expand the agency's existing complaint-based authority to investigate rail service issues by providing it with a new authority to investigate systemic rail service issues without a formal complaint, subject to the authorization of the Minister of Transport. This would give the agency new powers to investigate and address service issues for multiple shippers at once, while retaining an appropriate level of oversight by the government.
The second Senate amendment we accept, with amendment, is the direction of traffic for long-haul interswitching. The government recognizes that the efficiency of shipments by rail is critical to bringing grains and all other commodities and goods to market. In recognition of the specific needs of captive shippers, such as those in the mining sector, Bill C-49 includes a new remedy, long-haul interswitching, which was designed specifically to provide them with competitive alternatives and better rates and service.
LHI, as we call it, would provide captive shippers with access to an alternative carrier, with the rate for the regulated movement, of up to 1,200 kilometres, being determined by the Canadian Transportation Agency, based on comparable traffic. This new remedy would be efficient and effective, with the agency conducting all the necessary work and analysis and issuing a decision within 30 business days. This remedy would help ensure that captive Canadian shippers continue to be globally competitive, with access to competitive rail services at the lowest freight rates in the world.
To further improve this remedy, the government is accepting the Senate amendment concerning the direction of traffic for long-haul interswitching movements, with minor changes. These amendments would help ensure that shippers located within 30 kilometres of an interchange or served by another railway are not excluded from accessing LHI if the railway or interchange is not in the reasonable direction of the movement of their traffic.
Not only is this bill supported by a wide array of stakeholders, but it would offer many benefits for all rail shippers, including those that are captive. We are committed to working with all shippers to ensure that these benefits are properly understood by all, and that they are used to the fullest extent possible in order to strengthen their negotiation leverage with the railways and hold them fully accountable for the quality of the service they provide.
Third, there is the addition of soybeans to the MRE, or maximum revenue entitlement. As another example of our government's continued support for Canadian farmers, and the agricultural sector more generally, we are accepting, with some modifications, the Senate's amendment of adding soybeans to the maximum revenue entitlement. The modifications would ensure that soybeans and their related by-products would benefit from the advantages of moving under the maximum revenue entitlement.
Recognizing the importance of ensuring that this bill strikes the right balance, the government is unable to support the remaining amendments proposed by the Senate.
In the area of freight rail, the first is long-haul interswitching in the Maritimes. While we understand the concerns of captive shippers in the Maritimes, we must also ensure the continued viability of the eastern rail network and fluidity through the Montreal area. While we do not intend to expand LHI to enable captive shippers in the Maritimes to access the remedy in Montreal, this bill would make significant improvements to existing remedies that would benefit these shippers.
In addition, Bill C-49 contains a number of other measures affecting marine transportation that should be particularly helpful for shippers in Atlantic Canada, including the liberalization of the rules regarding the repositioning of empty shipping containers, as well as amendments to the Canada Marine Act to permit port authorities and their wholly owned subsidiaries to receive loans and loan guarantees from the Canada Infrastructure Bank.
As well, we could not accept final offer arbitration based on cost. This bill seeks to strike a careful and effective balance between the interests of railways and those of shippers, and we believe it does just that. The existing Canada Transportation Act provides shippers with a commercially based final offer arbitration process to settle a dispute during a negotiation of a confidential commercial contract with a railway.
FOA is intended to establish a market-based rather than a cost-based rate. As part of this process, an arbitrator is already allowed to request technical assistance, including costing and legal assistance, from the Canadian Transportation Agency. There is nothing in the act that obligates the arbitrator to seek the consent of railways for such assistance. The arbitrator can hold any failure on the part of the railways to disclose information against the railway when making a final decision.
Bill C-49 benefits shippers in many ways, including enabling the minister to publicize aggregated freight rail information that will help shippers in their commercial negotiations with the railways, and lessening the need to access remedies such as the FOA. Through this bill, shippers, including captive shippers, are offered many alternative remedies such as LHI, reciprocal financial penalties, shortened timelines for agency decisions, and access to improved informal dispute resolution mechanisms. All of these will respond to shipper needs and concerns for greater access, more transparency, and increased accountability.
In the airline sector, with respect to the amendments relating to the provisions of the bill on air transportation, we do not agree with the amendment to the provision relating to people affected and air passenger rights.
The government does not support the amendments proposed to the provision relating to passengers likely to file a complaint if they feel that an airline has not properly taken their rights into account. These passengers are designated by the expression “person affected” in the bill. Although Bill C-49 refers to the fact that only a person affected may file a complaint, I would like to point out that this does not prevent the passenger from asking for assistance from third party advocates to support his or her complaint.
Furthermore, organizations that represent Canadians or promote improved air service on their behalf will still be able to play that role, by challenging the contents of tariffs they find unreasonable.
On issues relating to the transportation of human remains, the government does not support the amendment aimed at developing airline policies concerning the transportation of human remains. Given that this information is already included in an airline's tariff, such a provision would be redundant.
The government developed a proposal to address tarmac delays that takes into account international best practices and the industry's operational realities. By “industry”, I mean airports and air carriers. Our approach not only sets clear, standardized requirements for all air carriers, but it will also apply specific standards of treatment to tarmac delays, regardless of the length of delay, and will require that passengers be disembarked following a three-hour delay.
Furthermore, there is no need to provide for a review of the passenger rights in this bill after three years. The bill already includes provisions requiring that the Canadian Transportation Agency produce an annual report on the number of complaints received, as well as performance indicators to assess how air carriers are complying with the passenger rights regime.
The Official Languages Act regulates compliance with official language obligations, and this act is the responsibility of Canadian Heritage and the Treasury Board Secretariat.
Naturally, Transport Canada continues to support Canada's two official languages, and this includes requiring that the regulations of Bill C-49 and all announcements regarding aircraft safety be in both official languages, but the scope of the proposed amendment exceeds the scope of the authorities in this act.
With regard to joint ventures, we think that Bill C-49's approach to the voluntary joint venture approval process strikes a fair balance between competitiveness and the public interest. I would like to remind my colleagues in the House that we agreed to an amendment proposed by the House of Commons Standing Committee on Transport, Infrastructure and Communities following its in-depth study of the bill. That amendment deals with the publication of the transport minister's decisions regarding implementation. The amendment already guarantees that the process will be transparent. Similarly, the Senate amendment providing that a review of joint ventures must be conducted every two years, creates an overlap because the minister already has the authority to review joint ventures as he or she sees fit. Moreover, it is not necessary to define the concept of public interest because, under Bill C-49, guidelines that set out the factors to be considered must be developed jointly with the Competition Bureau.
With regard to voice and video recorders on locomotives, the government does not support the proposed amendment to prevent companies from proactively using the data from these recorders. The central purpose of the recorder regime is safety. The amendment in question would considerably reduce the safety benefits of recorders. A 2016 report from the Transportation Safety Board showed the benefits of using data from recorders to proactively identify and mitigate risks.
Finally, while the government cannot support these amendments, we recognize the thoroughness of the review of the bill conducted by the Senate, and the special care that senators took in proposing these amendments. I would like to thank the Senate and the many witnesses who took the time to prepare submissions or to appear before the Senate committee for their valuable contribution to the legislative process.
The performance of Canada's transportation system is critical to the overall well-being of Canadians and our trade-dependent economy. We need to help to ensure that the system is best positioned to meet the demands of the economy so we can keep Canada's travellers and trade moving efficiently and safely today and in the future. This is precisely what we are proposing to do with Bill C-49.
To further strengthen this bill, the government is proposing to accept five well-articulated Senate amendments which would significantly reinforce the objectives of this bill. I mentioned that this is in addition to the nine very good amendments that came to us from the House Standing Committee on Transport, Infrastructure and Communities. The robust due diligence and hard work of senators and members of Parliament will help to ensure the continued viability, efficiency, and safety of the Canadian transportation system.
Most important, as requested by a large number of Canadian shippers, the passage of this legislation would establish new “own motion” powers for the Canadian Transportation Agency, ensuring that shippers will be able to benefit from a stronger, more accountable freight rail transportation legislative framework. In terms of rail freight, the swift passage of this bill would enable much needed contingency planning, more comprehensive data, and new powerful remedies for the sector, helping to avoid a repeat of the issues experienced this year.
This bill would also increase the safety of the transportation system, as well as ensure the security of all those who utilize it. This bill would additionally ensure the implementation of world-leading passenger rights for air travellers, bringing Canadian transportation into the 21st century.
The resulting legislative package has been carefully crafted to achieve a fair, balanced, and safe transportation system that will establish the conditions for the success of the many players involved, while supporting a strong and prosperous economy.
The testimony heard from witnesses from all over Canada made one thing very clear, that the passage of this legislation must be a top priority for the government.
I am seeking the support of the House to vote in favour of this government motion. This will, in turn, expedite the passage of the bill to the Senate once again for its consideration and approval.
