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Proceedings of the Standing Joint Committee for the
Scrutiny of Regulations

Issue 10 - Evidence,  May 19, 2005

OTTAWA, Thursday, May 19, 2005

The Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations met this day at 8:32 a.m. for the review of statutory instruments.

Senator John G. Bryden and Mr. Gurmant Grewal (Joint Chairmen) in the chair.


The Joint Chairman (Senator Bryden): I call the meeting to order. The committee's senior counsel, Mr. Bernier, will not be present today.

I have just been advised that in respect of the notice of disallowance sent to the two Houses, which was introduced in the Senate on May 5, the day that it was adopted in committee, and introduced in the House of Commons on May 9, Mr. Lee has information that the Minister of Fisheries and Oceans has given notice that he will introduce legislation to correct the issue behind the disallowance. The committee must decide whether it can take action that would allow that happen rather than proceed with the disallowance debate.

With the concurrence of the members of the committee, I would ask Mr. Lee to explain the situation in the House of Commons so that members can go ahead immediately with the debate or proceed otherwise with a viable solution.

Mr. Lee: Yesterday afternoon, the Government House Leader in the House of Commons signed the piece of paper containing the notice — although I did not see it being introduced — that was prepared for the House and, I believe, was introduced to the House. The paper contained the notice of the government's intention to introduce a bill that would address specifically the item contained in our disallowance report under the Fisheries Act.

Again, although I did not see the notice, the bill will contain only the section that was originally drafted for this purpose and put into the old Bill C-33. That old section number included adding, after section 9 of the Fisheries Act, a new section 10 that, for reference, is seen as section 2 of Bill C-33. It will be the same wording and the same section, and it is only that section. That affects the disallowance problem that we reported to the House.

The Joint Chairman (Senator Bryden): Do you know what the section states?

Mr. Lee: I can read it for the record; it is quite short. It is styled as section 10(1) and states:

Everyone acting under the authority of a permission granted under section 4 or of a lease or licence issued under this Act shall comply with its terms and conditions.

There is a subsection that states, in part, that those permissions, leases and licences are not statutory instruments. That section clarifies and resolves the problem. The issue is whether the committee should take steps to pre-empt the statutory procedure when the clock is already running in the House and in the Senate.

Based on tradition, the committee would not normally pursue a procedure where the fix was already happening. Procedurally, the matter becomes one of, first, whether there is a disposition on the committee to pre-empt the House disallowance procedure, which is now in statutory form; and, second, how the committee would do it, given that the procedure is contained in a statute and neither committee members nor the House could arbitrarily rewrite a statute.

There are some possible answers to both questions, Mr. Chairman, but perhaps you could seek the view of committee members as to whether they would be willing to take the steps to stop the disallowance procedure, acknowledge the existence of the statutory remedy and follow up with the necessary procedural steps.

The Joint Chairman (Senator Bryden): I would ask counsel's position in respect of this matter. There is no actual procedure in place, but it could be done with consent in the House. In the opinion of counsel, does the proposed legislation answer the issue that the committee was attempting to resolve?

Mr. Peter Bernhardt, Counsel to the Committee: Certainly, Mr. Chairman, it puts the committee back in the position that it sought before it tabled the disallowance notice. Members will recall that the 30-day notice that the committee intended to table disallowance was delivered after the minister had advised the committee that it was not expected that the bill would be re-tabled in the foreseeable future. In part, it was the hope of the committee at the time that putting the department on notice of the disallowance would lead to the bill being re-tabled. When that did not happen, the committee went ahead with the report. Now, somewhat belatedly, it seems the department has roused itself and proposes to go ahead.

This is the same provision that the committee looked at previously. In the letter of April 14, 2004, the joint chairmen advised the minister that the proposed amendments, if adopted, would remove the basis for the committee's objections. Obviously, that would still be the case.

I should also add that the committee expressed no views on whether the policy behind that would be a good idea or not, concluding that it was beyond the remit of the committee and wishing not to be perceived as taking a position on the desirability of it. Nevertheless, it would resolve the committee's concerns, if adopted. From that point of view, what the committee was seeking to achieve through the disallowance — formally, at least — would be achieved.

As Mr. Lee says, the question then becomes what would be the appropriate procedure should the committee wish that the disallowance not go ahead. Section 19.1 of the Statutory Instruments Act does not deal with that. It sets the wheels in motion, but it makes no mention of what procedure, if any, would be followed to take that train off the tracks. That would be something that the committee might wish to seek advice on from the procedural experts in the House.

One approach might be for the joint chairmen to seek unanimous consent of the House that the report be referred back to the committee for further study. There is some precedent for that course of action. That is what happened in 1987 to the first disallowance report. At that time, the procedure was in the Standing Orders, not in the statutes, so the situation was somewhat different.

The first question for the committee is whether it wishes to explore that possibility and, if so, finding out what the different avenues might or might not be.

The Joint Chairman (Mr. Grewal): I do not have any objection if we have to pull the disallowance. My concern is that we have devoted a lot of time to this file since the fall to reach this point. Given the tradition of this committee, we do not move disallowance when we have an indication or a promise that it will be done through legislation. In view of the current political volatility and uncertainty, we do not know when this legislation will be introduced. Mr. Lee has not seen it with his own eyes yet. Assuming that the legislation will be introduced soon, how long will it take to pass through Parliament? In the meantime, we do not want to derail the process that has taken place.

Given the uncertainty and the knowledge that there may be delays, I do not want to find this committee back at stage one, two or three. We have accomplished something. Before we take any action, I would like an assurance, in some formal way, that the work this committee has done will not be delayed. I would also like a time frame. I think that would be in the best interests of this committee. As we find ourselves in a very fluid political situation, I do not want to do anything that would jeopardize the good work that this committee has done.

Senator Moore: That is my concern as well. We have an indication that legislation will be introduced, but we do not know when. If it were to be introduced, when would it be passed?

This matter has been before us for some time. I would not like to see us give up the ground we have gained. Can they not proceed in tandem and then, at the appropriate time, we could abandon the disallowance?

The Joint Chairman (Senator Bryden): I would ask counsel to reply to that question. The problem is once we get to the automatic trigger, the debate must take place the next day or within a similar period of time. It will last for one hour and then there will be a vote. I believe that under the statute, the time at which the disallowance automatically occurs in the House of Commons is not that far away.

Mr. Lee: June 6 is the date when there would be either a deemed adoption or a debate triggered by the minister's filing of his notice of intention to object and debate the matter. If there were to be such a debate, the vote would happen on the Wednesday following June 6, which would be June 8.

Senator Moore: A debate would be triggered by the minister. Where is the new legislation? When is it proposed that the legislation will be introduced? Will it happen before June 6? Do we know, Mr. Lee?

Mr. Lee: Yes, the minister tabled a notice for the bill. It requires two-days' notice, so it could be introduced tomorrow. It could be brought forward any time.

We could seek an assurance that the government would put that bill up to the top of the list of government orders and bring the matter forward. It is just a one-section bill; I cannot imagine any opposition to it, but one never knows. I suspect it would pass pretty quickly in both Houses, but no one can give that assurance.

It is the intention of the government to deal with this issue expeditiously and clear it up. None of us is in control of the whole thing, but that would be my view. We could probably get this bill through in a couple of weeks if those of us around the table put our heads together.

The Joint Chairman (Mr. Grewal): We have another Scrutiny of Regulations Committee meeting on June 2. Until then, we will keep the communication channels open and watch to see if any legislation is on its way or is indeed introduced. In the meantime, perhaps our clerk or counsel can contact the minister's department with a view to ascertaining the progress on the bill. If we are given an assurance that the bill is forthcoming, we can make a decision on June 2.

In case we have to withdraw that disallowance report in lieu of the assurance that we will get, then we can talk with the House leaders to seek unanimous consent to withdraw. I do not know the procedural aspect. If there is no assurance or cooperation coming from the minister and we do not know where we stand, then we should let the debate take place.

The Joint Chairman (Senator Bryden): We would have until June 2 when we would meet again. We can allow this process to proceed and evaluate it on June 2. If it proves to be ineffective, on June 6 the statute is triggered and we are into a debate, with a vote to take place on June 8.

If the issue can be fixed without having to use disallowance, then let us fix it. If that does not happen, then we have lost nothing because the clock is still ticking. Our time may be up in the Senate, but disallowance must happen in both Houses. The Senate is just standing this item because the Minister of Fisheries is in the other place and we have the other chair. That would be one of the ways to proceed.

Mr. Lee: I think our joint-chair is suggesting that we set the matter aside for two weeks. As I look at it, nothing will change in two weeks, unless someone reneges. The committee should determine now how it will proceed.

There is another element to this file. Committee members are aware of the uncertainty of the position of the House this evening and tomorrow. If the House were to dissolve, the committee would not have its June dates, which would be flipped over to a new Parliament. The new Parliament would return without committees and infrastructure, which would not be established for a few days. The sitting days would run, but there would be a messy procedural scenario because there would be only a few of them and with no House and committee leadership. The government would be in place but the House would be helpless in simply watching the sitting days pass. No one knows whether any of us would return to manage this file. There could be an entirely new membership on the committee. I would urge members to take a decision this morning on how the committee will proceed. Taking a decision on Thursday, June 2, when the debate on the fifteenth sitting day would be June 6, would not leave much time to make adjustments. I would suggest that members decide today what they want to do and take steps in that direction.

The Joint Chairman (Mr. Grewal): I agree with some of Mr. Lee's comments, but if the House is dissolved as a result of tonight's vote, there would still be a significant amount of ongoing work for the committee. Some House members on the committee will return and the Senate members will be here, as well as staff. They could advise the forthcoming committee to follow up on this file, or the matter could be resolved by unanimous consent.

Mr. Lee: There would not be a committee.

The Joint Chairman (Mr. Grewal): I understand. However, if some committee members return, they could be advised of seeking unanimous consent or it could be left in the hands of the new House leaders. There is a possible solution. In anticipation of Parliament's dissolution and the committee's need to take action, and without any assurances, I would not recommend that course of action. If there is assurance in writing from the minister, then the committee could look into that. The minister would have a greater opportunity between June 2 and June 6. Therefore, the committee has sufficient time to pursue this matter further. The decision can be taken on June 2 and the staff can follow it up with the minister. Let us seek assurance from the minister. At this time, no facts and no assurances from the minister are before the committee.

Mr. Macklin: There are numerous political solutions. First, the House leaders could agree. Second, one person could seek unanimous consent in the House. Third, when the time came for debate, the House could defeat the committee's disallowance. There are numerous options that would protect, if it were deemed appropriate by the House to do so.

Committee members need not get too caught up in determining a solution now because the House that would be sitting would have command of the issue one way or the other.

The Joint Chairman (Senator Bryden): If Parliament were to dissolve, this committee would disappear. What would happen to the report of the committee to the current Parliament? Would that disappear as well?

The Joint Chairman (Mr. Grewal): I do not think it would disappear.

The Joint Chairman (Senator Bryden): It would disappear from the Senate.

Mr. Lee: That is a good question. The procedure is in the statute, but the report is the hands of the House when the House dissolves. I do not have the answer to that question, but it is a good one.

The Joint Chairman (Senator Bryden): I am advised that as far as the Senate is concerned, Parliament's dissolution means that all items on the Senate's Order Paper die. In order for this disallowance to take effect, the committee's report must be passed by both Houses. Even if it automatically proceeded in the House of Commons, it could not go further because it would be gone from the Senate. The committee would have to reintroduce it in the Senate in the new Parliament in order to satisfy the statute.

In the event that dissolution occurs, our problem would be taken care of in that it could not go any further. If this Parliament were to continue after tonight's vote, would that not put us in a position to have the minister, who has given notice that he will introduce legislation, assure the committee that it would be introduced in sufficient time for the committee to consider it? Certainly, we would have a period of time to deal with it.

Mr. Lee, we are depending on you and Mr. Grewal to some extent.

Mr. Lee: I am suggesting that if the committee does not want to take steps today, members should speak up. If members do not want to take any steps, then the committee should ask the clerk to resolve the questions that have been raised and ask counsel to keep an eye on those issues. In that way, if a procedural move has to be made, the committee would be in a position to do it rather than ask people to look up questions.

Senator Moore: That would be on June 2.

Mr. Lee: The committee could be prepared. The joint chairmen, in addition to waiting for the research and the questions to be answered, could craft a resolution to be considered by the committee on June 2. They could collaborate in a recommended resolution for June 2.

The Joint Chairman (Senator Bryden): If members are agreed, then the committee will instruct our counsel and clerks to examine the procedures available to take action to get rid of our disallowance motion, without having it debated, should the legislation be introduced and passed. That information would be available when the committee next meets. With the help of counsel and the clerks, the joint chairmen would come forward with alternative approaches that would work, other than the unanimous consent solution, which could be used, I assume.

The Joint Chairman (Mr. Grewal): In the meantime, the committee could try to obtain answers to today's questions.

The Joint Chairman (Senator Bryden): That is my point.

Are members aware of the committee's position? If the government were to fall, the committee would cease to exist and the Senate would torpedo the report that currently stands on its Order Paper. If the government were not dissolved, then we would be in a position to meet on June 2 to continue the process, provided there were assurances that the bill would be passed as quickly as is reasonably possible in the House of Commons.

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): We will now go to our agenda, and I turn it over to Mr. Bernhardt and Mr. Rousseau.


(For text of documents, see Appendix A, p. 10A:1.)

Mr. Bernhardt: The committee's concerns on this file are a number of fairly routine matters of drafting. For more than two years, the amendments to resolve these matters have been caught up in a package of amendments that has been the subject of discussions back and forth between the Canadian Transportation Agency and the Department of Transport.

In his March 24 letter, the Minister of Transport advises that there are still a number of issues that have proven difficult to resolve. Discussions are ongoing to achieve concurrence. However, as these regulations are made by the agency, strictly speaking, the Department of Transport's concurrence is not a prerequisite.

Be that as it may, one gets the feeling that this process will take some time yet. In light of this, the committee may wish to consider whether the joint chairmen should write to the Chair of the Canadian Transportation Agency to ask that the routine amendments addressing the committee's concerns be separated out and processed independently.

At the conclusion of his letter, the minister invites the committee to share its views on international air transportation policy with the House of Commons Standing Committee on Transport. To the best of my knowledge, the committee has never formed any views on international air transportation policy. I suppose if it did, as a parliamentary committee, it would feel free to communicate those views directly to the two Houses. There does not seem to be much to pursue in connection with that suggestion. That brings us back to the issue of whether the committee wants to try to get its amendments separated out.

Senator Moore: I think we should try to do that and ask for a response by the end of the month.

Mr. Lee: I found that the minister's letter back to us, dated March 24, tended to fuzz the issue considerably. Inviting us to share our views with the other standing committee of the House reveals a misunderstanding of what we are up to here. I do not know how we can crystallize a better awareness.

These regulations are nine years old, and I think we should start the clock running on this file. Certainly, we must write back to the minister, but the letter should be awfully firm in stating that we are not engaged in a process of negotiation or a sharing views or opining on things. We have concluded that these regulations have a problem.

We have not had a description here this morning of the nature of the defects and the subject area.

Mr. Bernhardt: They are fairly routine drafting matters. I take it when they talk about difficulty in resolving issues, they are referring to other issues in this broader package of amendments, not the issues that the committee had, per se.

Mr. Lee: The only way I can foresee a conclusion to this file more quickly is to provide a reasonable deadline for a resolution and hold it out to the minister. If the comeback to us is that they are unable to deal with it, then we can take a decision on future steps.

The Joint Chairman (Senator Bryden): Is that agreed?

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): I would also ask counsel to make reference to the suggestion about international transport, that it is really not our jurisdiction.

Mr. Bernhardt: The expression "form letter" came to mind when I saw that reference, Mr. Chairman. I was left with the feeling that whoever drafted it for the minister's signature found a form paragraph and thought that a little padding at the end might look nice. It does not really fit.

The Joint Chairman (Senator Bryden): Are you indicating that it does not even warrant a reference?

Mr. Bernhardt: No, not at all.

Mr. Lee: Leave that on the record.

The Joint Chairman (Senator Bryden): That is agreed.



The Deputy Chairman (Senator Bryden): The next point concerns seeds regulations.

Mr. Jacques Rousseau, Legal Counsellor: As indicated in the note prepared for the committee, two points were raised at the outset. The note provides the reasons why the committee can decide to close this file.

The first point was settled by an amendment to the regulation. The second point relates to a suggestion the committee made to improve one aspect of the regulation concerning the amount to be paid when an inspection is cancelled. The agency had agreed to consult producers with regard to the suggestion.

Finally, the agency announced that there would be no consultation on the committee's suggestion as such, because the solution was discussed and accepted by the sector stakeholders. As the committee only made this suggestion simply to improve the situation, the committee could decide that it is unnecessary to insist that the agency hold a consultation since the existing system has been in place for a number of years and seems to function well.

With the committee's agreement, this file could be closed.


Hon. Members: Agreed.


(For text of documents, see Appendix B, p. 10B:1.)

Mr. Bernhardt: Mr. Chairman, the issue here is one of subdelegation. Section 69.41(b) of the Telecommunications Act authorizes the Governor-in-Council to make regulations prescribing telecommunications apparatus or classes of apparatus in respect of which a technical acceptance certificate is required. Section 3 of the regulations provides that every apparatus in respect of which the minister has established technical specifications requires a technical acceptance certificate.

It is suggested this cannot be said to prescribe the apparatus in respect of which a certificate is required. In effect, a relevant determination will be made by the minister when he makes a decision as to whether or not to establish a technical specification. To all intents and purposes, the legislative power conferred on the Governor-in-Council has been subdelegated to the minister to be exercised on an administrative basis.

Much of the reply from Industry Canada deals with what is described as the functioning importance and future prospects for this scheme — in other words, the underlying policy. None of this is of much relevance to the legal issue concerning whether a subdelegation has taken place here. That is really only dealt with on pages 5 and 6 of the department's reply.

In essence, they are taking the position that it is sufficient that the regulations set out a method that makes it possible to ascertain which apparatus is required to have a certificate. The committee has always rejected this line of argument. The authority conferred on the Governor-in-Council is to prescribe the apparatus, not to prescribe a method for ascertaining the apparatus in question.

The department also suggests that, logically, there must first be a technical standard developed by the minister in order for a certificate to be issued stating that the standard has been met. I would suggest this puts the matter backwards. What the act envisions is that the minister will be required to develop a standard because the Governor-in-Council has made a regulation prescribing that that equipment requires a certificate. In effect, the department's reply puts the cart before the horse. I suggest that the matter be pursued in a further letter.

The Joint Chairman (Senator Bryden): Is that agreed?

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): I went through this letter. If we are able to zero in on the point just made by counsel, the department might get it. In fact, they do have the cart before the horse.

Mr. Lee: Policy considerations are always relevant to the policy wonks in the functioning of the system. However, from our point of view, let us just say it is not quite so material. We have had to do this many times with departments. There must be a wording that we use routinely to signal this to the readers of our letters.

I would keep it short and sweet and say that our focus is the alleged ultra vires nature of this subdelegation and we only want to hear about that. If they have nothing further to say, then we will consider our options. You can use the word "disallowance" at this point in time. They might as well know that we are dealing with something focused and specific. If they do not have any good legal basis for clarifying their purported legality of this provision, then we can move ahead fairly easily with disallowance. If there is continued disagreement, then the road is clear for the committee. I would like a letter to be drafted to include some of that.

The Joint Chairman (Senator Bryden): Are members agreed?

Hon. Members: Agreed.





(For text of documents see Appendix C, p. 10C:1.)

The Deputy Chairman (Senator Bryden): The next point on our agenda contains three regulations we will deal with together.

Mr. Rousseau: Two points were raised with regard to these regulations. The agency is still studying the second point. As for the first point, the problem is that regulations were adopted pursuant to the act, and that act prescribes that the regulations must be passed on recommendation of the Minister of National Revenue. As you can see, their adoption was recommended by the Solicitor General. In the agency's reply, nothing leads us to conclude that this power of the Minister of National Revenue was conveyed to the Solicitor General. The agency simply refers to the fact that the minister responsible for the new Border Services Agency of Canada recommended the adoption of those regulations.

Obviously this is not sufficient to obviate Parliament's will. Only a provision to that effect would authorize such a change. There has been no such provision in the texts mentioned by the Revenue Agency. The recommendation of legal counsel is to write to the agency again to explain why their response is not satisfactory and also ask whether the agency is now ready to provide a reply on the second point.


Mr. Lee: I would ask counsel whether, from the committee's point of view, an ex post facto recommendation from the Minister of National Revenue would operate to fix the earlier alleged omission. Is it suggested that they have to re-enact these regulations with a new recommendation, or is there a fix that can be had by an ex post facto recommendation?

Mr. Rousseau: It is not clear whether there could be a retroactive recommendation.

Mr. Lee: It is not clear.

Mr. Rousseau: It is not clear at all.

Mr. Bernhardt: I would assume that they would have to be re-enacted.

Mr. Lee: Unfortunately, at this time the only viable fix would be a re-enactment of the regulations.

Mr. Rousseau: Parliament would have to intervene.

Mr. Lee: Technically, this is rather serious. The answer we are looking for from the department is a discussion on the issue of whether the Minister of National Revenue really had to give the recommendation or whether an alternative would be acceptable.

Mr. Rousseau: At this time, the department has not indicated that there is a provision allowing the Solicitor General to recommend.

Mr. Lee: Let us continue to debate. I am happy with that.

The Joint Chairman (Senator Bryden): More than one department was rolled into this, that being the Solicitor General and Transport. Are we certain that there is not a statute to authorize that development?

Mr. Rousseau: We did not find one and the department did not guide us in that direction.

The Joint Chairman (Senator Bryden): Perhaps your letter could indicate that the committee would be interested in knowing whether there is a statute that legalizes or ratifies what they are doing. Otherwise, we have to deal with the existing law.


Mr. Bernhardt: Mr. Chairman, the committee has one remaining concern about this file and it relates to a matter of drafting. The regulations are to be revoked and replaced by new regulations upon the coming into force of amendments to the Motor Vehicle Transport Act, 1987. This has been delayed apparently due to the process of achieving consistency with and among various provincial commercial motor vehicle regimes. Most recently, the committee was advised that the expectation is that new legislation will come into force on January 1, 2006. If this is acceptable for now, progress will be monitored in the usual fashion.

The Joint Chairman (Senator Bryden): Are members agreed?

Hon. Members: Agreed.



The Deputy Chairman (Mr. Grewal): We shall now move to the next point.

Mr. Rousseau: In this file, promised amendments concerned the wording of the regulation. The department informs us that amendment development has been initiated. It hopes to complete these changes during fiscal year 2005-06. With the committee's agreement, counsel will be following progress in the usual way and will apprise the committee of developments.


The Joint Chairman (Senator Bryden): Are members agreed?

Hon. Members: Agreed.



(For text of documents, see Appendix D, p. 10D:1.)

Mr. Bernhardt: Mr. Chairman, when these two files were before the committee on April 21, members decided that given the failure to reply to counsel's letter of November 28, 2000, it should be suggested to the Designated Instruments Officer for the Department of Finance that she provide the outstanding reply in person.

Not surprisingly, this resulted in the department's letter of April 28. In that letter, an amendment is promised to address the matter discussed in point three. Points one and two concern an identical question, which is whether provisions that permit the Commissioner of Customs and Revenue to take into account any factors relevant to the circumstances when he makes certain determinations can be said to prescribe the factors to be taken into account as required by the relevant enabling provisions in the Special Import Measures Act.

It was pointed out to the department that to provide that every factor that may be considered perhaps "amounts to prescribing nothing at all." The department's reply seems to be more concerned with the need for these provisions rather than with their authority.

The short answer to that is to always amend the act to permit regulations, in this case respecting the factors to be considered as opposed to prescribing them. In fact, the enabling authority for the provision dealt with in point three incidentally was already so amended. In that case, it would simply be a matter of re-enacting the provision under the new enabling authority. This, then, is a matter to be pursued in this file.

Now that the reply has been received, the question is whether the committee still wishes officials to appear or whether there should be a further letter only.

The Joint Chairman (Senator Bryden): The committee could draft a followup letter at this stage. These people need to be brought before the committee, which is sometimes helpful, but it is not necessary at each meeting.

Senator Moore: It is suggested that the committee send a letter to officials requesting action. Would there be a time limit, or can we expect another protracted exchange? I would like to see a definitive time frame as to when things will happen.

Mr. Bernhardt: We have no agreement on the issue. It is somewhat difficult to impose a time frame on the department for taking action when they have yet to agree that any action is required. Certainly, the committee can indicate a preferred time frame for a response in order to avoid the process of threatening an appearance by officials.

Senator Moore: Once there is a threat or an indication of a requirement for officials to appear and it is not followed through, then the committee becomes a lame duck. The committee must continue to pressure the department so that it realizes the seriousness of this matter and that, depending on its reply, officials may be required to appear. I would like to let the department know that the committee means business.

The Joint Chairman (Mr. Grewal): That is a good point.

Mr. Bernhardt: We could refer to the previous delays and indicate that the committee fully expects that they will not be encountered this time; otherwise, there will be consequences.

The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.



(For text of documents, see Appendix E, p. 10E:1.)

The Deputy Chairman (Mr. Grewal): We shall now move to the plant protection regulations.

Mr. Rousseau: Mr. Chairman, the adoption of SOR/95-212 solved about 20 problems raised when the Plant Quarantine Regulations were examined. The replacement regulations, the Plant Protection Regulations, led to our raising 25 points in the letter dated November 20, 2000.

As the committee will note when it will examine SOR/2002-438, amendments were made to correct drafting errors noted in points 3 and 17. Amendments have been promised concerning points 1, 2, 10, 14, 18 and 23. One might also conclude that the reply concerning point 22 implies that an amendment will have to be made. This, however, needs to be confirmed. Replies provided in the letter of May 22, 2001 may be considered satisfactory as regards points 6, 11 and 15.

There remain 15 points concerning which the replies of May 22, 2001 and February 14, 2005 are not satisfactory. I will try to summarize, beginning with the list sent by committee counsel on November 20, 2000.

The issues raised in some of these points are well known to the committee. In points 3 and 8, in the last paragraph of point 9, in the first sentence of points 13 and in point 20, we refer to provisions which, for instance, would lead to penalizing a breach of an administrative authorization or permit as though this were a breach of a law or regulation — that is the first topic we discussed this morning.

Section 5(4) of the regulations states for instance that whoever obtains an authorization referred to in subsection 2 must respect all of the conditions therein. Obviously, if someone does not respect the conditions of that authorization, not only can that person be taken to task for not having respected those conditions, but he or she may also be held to have contravened subsection 5(4) of the regulations and if that person is convicted, he or she may be liable to a fine or to imprisonment.

The committee has in the past opposed provisions of this nature, among others in its report number 75 in which it recommended that subsection 36(2) of the Ontario Fishery Regulations, 1989, be disallowed. The agency replies that these provisions are behaviour standards, an explanation which the committee has already rejected.

In point 8, counsel also raised the issue of knowing whether a regulation can be made pursuant to which a decision by a minister or an inspector may be conveyed to the persons subject to the posting of that decision on location, for instance in an area infested with parasites. The agency's argument rests on an example taken from the Plant Protection Act. This example is not convincing as several other provisions in the act attempt to demonstrate that the Parliament did not intend to allow posting of those decisions in a case such as section 22 of the regulations; at the very least, it would be appropriate to suggest that the act be clarified.

We may also group the issues raised in points 5, 24 and 25. In all of these cases, the regulations give powers to inspectors that have already been provided for in the act by Parliament on certain matters. The agency's replies are not satisfactory. In point 5 there is no doubt that the act already contains the power set out in the regulations. The agency explains that section 16 of the regulations allow for studies to determine whether there is a parasite problem or risk, and to determine the extent of the problem. The act provides for its part that the powers delegated to inspectors have as their object the verification of the existence of these parasites.

In points 24 and 25, the agency writes that the point is indeed to inform Canada's trade partners and clarify the act. This is obviously not the parliamentary delegate's role, especially when Parliament's delegate claims to clarify what Parliament has passed.

As for point 7, the last paragraph of point 9, paragraph 3, point 16, these are three illegal subdelegation of authority cases. For instance, in point 7, the law gives the governor in council the power through regulation of restricting access to or prohibiting the use of infested locations. The regulation provides that when the minister or inspector has reasonable grounds to believe that a location is infested, the inspector may prohibit or restrict its use.

The agency states that it is impossible to draft a more precise regulation. If that is the case, then the act must be amended. As it stands, that aspect of the regulations is illegal.

Points 4, 12 and 21 have this in common: their object is to fight fraud rather than parasites. The purpose of the law is, of course, to fight parasites. It can then be said that the regulation goes beyond the object of the act whenever it attempts to repress fraud when this is not justified by the repression of parasites. The example I will give is subsection 46(3) of the regulations, which provides that no one may substitute goods for which a movement certificate has been issued.

The agency explains that a person may commit a fraudulent act to prevent the agency from detecting parasites. It gives the example of a person who has non-infested pines examined, obtains the certificate, and replaces the non-infested pines by other pines that are infested with parasites and for which no certificate has been issued.

Committee counsel's view is that that person is already in breach of paragraph 45(2)(a) of the regulations for having moved the pines without the required certificate. That person can thus be prevented from moving the parasite-infested pines, and sued. Thus, the objective of the act is attained. In that context, subsection 46(3) of the regulations can only be used to repress fraud and is not in keeping with the object of the act.

Point 19 has been reformulated in counsel's letter dated March 17, 2004. Subsection 45(1) of the regulations states that the movement certificate may contain the conditions the minister deems necessary to, for instance, prevent the spread of a parasite. Counsel has suggested that this provision be drafted in such a way as to avoid conferring to the minister and the inspector a power that is expressed in subjective terms. The agency replies that it is impossible to foresee all situations that may arise. In fact, no one has suggested doing that.

The agency also explains that that provision is not as subjective as one might think since the inspectors act in accordance with the law. This reply is not satisfactory because the fact remains that the criterion used is needlessly subjective. Indeed, if subjection 45(1) were amended to eliminate the word "judge," the minister and the inspector would still have the power to impose the necessary conditions to prevent the spread of a parasite.

Finally, there is no reply to the comments made in the second sentence of point 13 and in the second paragraph of point 16. Following the reply made by the agency to the comments contained in the last paragraph of point 16, there is reason to ask whether the wording of the provision should not be amended in order to clarify it.

With the committee's agreement, counsel's recommendation is to write to the agency again to explain why certain replies were not satisfactory, obtain the missing replies, suggest certain amendments to the wording of the regulations and asked about progress concerning the promised amendments.


The Joint Chairman (Mr. Grewal): The responses to the 15 points are substantive and I think a strong letter will help to resolve them.

Mr. Anders: To ensure that I vaguely followed that, on the subject of pests, is it fair to say that someone is questioning whether the department is being a pest with regard to its property?

Mr. Lee: I do not think that is quite it.

Mr. Anders: That was my stab.

The Joint Chairman (Mr. Grewal): Is it agreed that we send a strongly worded letter?

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): I think if we continue to narrow the area, we should be able to gradually move it forward. There is a lot of information in there.



(For text of documents, see Appendix F, p. 10F:1.)

Mr. Bernhardt: Some 38 points were raised in counsel's letter of September 17, 2004. The department's reply promises action on most of them. For the record, I refer to points 1, 2, 4, 5, 8 to 15, 17, 18, 20, 21, 23, 26, 27 and 29 to 37. In addition, it is suggested that the replies to points 28 to 38 can be considered satisfactory. In a number of cases, however, specific questions were asked or requests for clarification were made but were not dealt with in the reply. These are found in points 4, 7, 17, 19, 24, 25, and 30. It is suggested that these be pursued through further correspondence. This is simply a matter of asking the questions again because they were not addressed.

That leaves several points on which the substance of the reply is considered to be unsatisfactory. Once again, for the record, these are points 3, 6, 7, 16, 19, 22, 24 and 25.

Senator Moore: Did you not say that point 7 was okay?

Mr. Bernhardt: I mentioned point 7 twice. There are some questions asked there that simply were not addressed. In addition, the portion that was addressed was also unsatisfactory.

For the most part, these items involve matters of drafting and clarification. Unless there are specific questions, I do not propose to go through each of them. However, two points merit some further comment.

The first one is point 24 dealing with subparagraph 30(c)(iii) of the regulations. This provision requires a dissident's proxy circular to include, in respect of each dissident, all convictions "in connection with violations of any corporate or securities laws or criminal convictions in a matter of an economic nature...during the preceding 10 years, for which a pardon has not been granted...." The reference to "criminal convictions in a matter of an economic nature" is vague. There are few criminal offences other than those against the person that could not be said to fit this description. The relevance of many of those to the solicitation of a dissidence proxy circular seems questionable. In view of this, it was suggested that the application of this provision should be limited to disclosure of offences under Part X of the Criminal Code. These offences are under the title "Fraudulent Transactions Relating to Contracts in Trade.

The department replied: is preferable to have the clause contain the possibility for more, rather than less, disclosure. By limiting the paragraph to specific Criminal Code violations, or specific types or categories of crime, would allow a dissident to "hedge" or use strict interpretation to avoid many sorts of disclosure. The current wording ensures a broader disclosure.

The goal of any legislation should be to define as clearly as possible the rights and obligations of those to whom the legislation applies. Here, it seems that the nature and scope of the requirement has been left deliberately vague in the hope that dissidents will not be sure what is required and, therefore, they will err on the side of broader disclosure. Rather than state with any certainty what is required, the regulation maker simply hopes that the vagueness of the provision will force as great a degree of disclosure as possible. I would suggest that this is not an acceptable approach to the drafting of legislation.

The other provision I will mention is point 25 of the correspondence dealing with paragraph 33(2)(a). This requires a copy of the dissident's proxy circular to be accompanied by a statement signed by the dissident or a person authorized by the dissident that the circular complies with the regulations. The department indicates that the purpose of this is to allow legal recourse should it be discovered that the proxy circular was fraudulent, contained fraudulent statements or was in contravention of the regulations. This being the case, it is difficult to see what purpose it actually serves because the Canada Cooperatives Act already provides in section 349 that every person who contravenes a provision of the regulations or does not fulfil a duty imposed by the regulations is guilty of an offence. It also makes it an offence to knowingly make or assist in making a report, return, notice or other document to any person that contains an untrue statement or omits a material fact. It would seem that the circumstances are covered perfectly well in the act. If this is what the provision of the regulations is intended to do, it would seem perfectly pointless.

It was also asked whether it was reasonable to require a dissident to state unequivocally that the circular complies with the regulations. Usually, in these circumstances, a person is asked to attest that to the best of their knowledge something is in compliance. That is usually the way these things are formulated. That, too, was not addressed in the reply.

I would suggest that these two points, as well as all outstanding minor points in question, should be pursued in a further letter.

The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): What fees are they suggesting? Is the fee for registering cooperatives or is it the fee that cooperatives charge?

Mr. Bernhardt: I believe that the fees are charged to the cooperative for various registrations and documents in respect of the governance and supervision of these organizations by the relevant department.

The Joint Chairman (Senator Bryden): It is significant that Part X of the Criminal Code be adhered to strictly. However, it seems that the department is on a fishing expedition hoping to catch something but there is no hook. Rather, the department is fishing with a net because this is so broad. There seems to be no concern for a person's privacy. I would suggest that that be highlighted in a letter.

The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix G, p. 10G:1.)

Mr. Bernhardt: As noted in the materials, this instrument made 29 amendments that were promised to the committee in connection with a number of regulations administered by the Canadian Food Inspection Agency. Unfortunately, that also gave rise to nine new concerns. Amendments have been promised to deal with all of these except for the ones described in points 3 and 6 of the correspondence, which relate to provisions of the Fertilizers Regulations.

Point 3 deals with section 10(d) of the regulations, which states that a mixed fertilizer can contain less than the required percentage of nitrogen, phosphorous or potassium if it is a product registered under the act. In order to be registered, a fertilizer must be in compliance with the prescribed standards, and so it was asked on what basis a product that does not meet the standards could be registered under the act.

The position of the CFIA is not entirely clear, but it seems to be arguing that it is sufficient that a product be determined to be efficacious, which is also a requirement in the regulations. In other words, the efficacious requirement and the actual standards of what must be in the fertilizer are seen as alternatives such that you can meet one so you can meet the other and be registered. Unfortunately, this is not the way in which either the act or the regulations are structured. This question needs to be pursued.

Point 6 relates to item 1.30 of Schedule II. Products listed in Schedule II are exempt from registration provided they meet the standards set out in the schedule. One of the portions of this standard states that sulphur-coated urea may contain about 30 per cent to 40 per cent nitrogen and 10 per cent to 30 per cent sulphur. It was questioned whether the vagueness of such a standard would not make it difficult for sellers and importers to know whether they are complying. What is the meaning of "about 30 or 40 per cent"?

The CFIA replied that this is a standard that is adopted and accepted by the industry and that to require a fixed percentage would undermine the effectiveness of the products. Why, then, could they not provide for an acceptable range? If you cannot provide for 45 per cent, perhaps you could provide for between 30 per cent and 50 per cent. The suggestion would be to remove the reference to "about." I suggest that as currently drafted the provision is virtually meaningless. This is the other point that should be pursued.

The Joint Chairman (Mr. Grewal): There are two points. First, there are two kinds of fertilizers and the range of 30 per cent to 40 per cent is too vague. It might be describing the two kinds of fertilizer that are conventionally known in the industry. Could that be the case?

Mr. Bernhardt: It may well be. Certainly, I do not think the committee would have any problem if it said 30 per cent to 40 per cent. When you throw an "about 30 per cent to 40 per cent" in, then you start to wonder what is about 30 to 40 per cent. Is it 25, is it 20? It makes the standard very vague.

The Joint Chairman (Mr. Grewal): Counsel mentioned that there are new concerns about nine issues. Have they ever been communicated before?

Mr. Bernhardt: Yes, we have a promise on seven of those nine. There is a promise to make further amendments. The two points I described are the two points that are still outstanding.

Mr. Anders: I do not know about everyone else, but I am personally okay with 25 per cent or 45 per cent sulphur content in fertilizer — not that I know what that means, but it does not bother me. If the regulation happens to be vague, why is that a problem?

Mr. Bernhardt: The vagueness is a problem for the person who needs to know if they have to comply with it. If they do not comply with it, they are in contravention of the law. The question for the committee is are members satisfied that there is sufficient certainty.

Mr. Anders: Has there been any issue with someone producing a fertilizer at 25 per cent or 45 per cent or some other such number that has been determined to be illegal?

Mr. Bernhardt: I have no idea. The agency tells us that this is the standard they have taken from the industry.

Mr. Anders: Are we actually addressing a problem? If people are having their fertilizers seized or disallowed because they are only at 25 or 45 per cent, then it is an issue.

Mr. Bernhardt: It may be. If I was advising a fertilizer manufacturer who had been charged because he had 29 per cent content instead of 30 per cent, you would certainly argue that is about 30 per cent, so there is no contravention. It may be that the industry prefers a vaguer standard.

Mr. Anders: If I was the industry, I would.

The Joint Chairman (Mr. Grewal): I remember that some of the contents of the elements in fertilizer go to decimal points; but if it is weighed, the farmers will be at a disadvantage.

The Joint Chairman (Senator Bryden): My concern was with the first part, that it complies with the regulation even though the amount that is listed of a particular element is less than what it says. If I buy 6-12-12 fertilizer, then I am expecting that 6 per cent of that is nitrogen. As I understood the regulation, as long as it is not more than 6 per cent, then they have complied with the regulation.

Mr. Bernhardt: I think that it would still run afoul of the various labelling requirements. You would have to label what is in it.

If the standard was that a fertilizer had to contain 10 per cent of an ingredient and you only had 5 per cent of it in your fertilizer, you could go to the department and say look that it does what it is supposed to do. Sure, it does not comply with the law, but it works, so go ahead and register it.

The Joint Chairman (Senator Bryden): I do not know how they would determine that it does what it is supposed to do. They do not know what I am going to do with that. The fact is that you need to be precise. If you buy 10-10-10 fertilizer, that is lawn fertilizer. If it is 6-12-12, you will use it on the gardens or potatoes.

I do not want to get into a course here on growing potatoes, but it matters. It matters a lot because you are paying for the active elements that are in there. If you end up with only 2 per cent nitrogen, then it should be 2-12-12. It should be much more specific. That is what I am saying.


Ms. Guay: I agree. If you buy 20-20-20 for your roses and flowers, and you do not use the right fertilizer ratio, results will be poor. The second important thing is that we need to know the precise quantities, so as to find out how our land is being contaminated. If we let this go without close attention, we will never know what contaminants have been placed in our land, what effect this will have, and concerning those who are involved in agricultural production on a broader scale, we will no longer know what we are eating from that production. Fertilizers have a very important role to play in our food supply. I agree that there should be extremely strict regulations so that we always know what we are dealing with. If this is not the case currently, we have to tighten up the regulations.


The Joint Chairman (Mr. Grewal): Do we agree to follow through?

Hon. Members: Agreed.


(For text of documents, see Appendix H, p. 10H:1.)

Mr. Bernhardt: Complaints made to the National Farm Products Council pursuant to paragraph 7(1)(f) of the National Farm Products Agencies Act are dealt with in what are called the NFPMC General Rules of Procedure. These are regulations registered as SOR/82-641.

The act requires that hearings of these complaints be conducted pursuant to regulations made by the council. However, the council has also implemented guidelines for the dispositon of complaints. This being the case, it was asked whether the guidelines were intended to supersede the general rules and, if they do, why they were not treated as regulations for purposes of the Statutory Instruments Act.

The agency has explained that the guidelines are intended to reflect a practice whereby a more informal process to resolve complaints takes place prior to the procedures set out in the regulations. It also advises that the guidelines are under review and are to be amended to clarify that actual hearings are to be conducted under the formal rules of procedure, and also that when the guidelines are rewritten, they will "serve as a general information document."

While one might wonder just what it is the guidelines serve as now, I suppose this reply may be taken to be satisfactory.

The Joint Chairman (Mr. Grewal): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix I, p. 10I:1.)

Mr. Bernhardt: The issues here are a minor point of drafting, as well as a discrepancy between the English and French versions. The CRTC has indicated that they will address these points the next convenient time that the regulations are being amended.

In the case of relatively minor amendments, the committee has, in the past, accepted undertakings to make corrections when the regulations are next amended, always with the proviso that this be done within a reasonable period of time. The committee has usually given two years or so as a reasonable time frame in those cases.

With those precedents, perhaps the CRTC could be advised of this as well as if at the end of this time no other amendments are being contemplated, then the amendments promised to the committee should be proceeded with regardless.

The Joint Chairman (Mr. Grewal): Are we agreed?

Hon. Members: Agreed.

Mr. Lee: Mr. Chairman, I certainly agree. However, in case anyone from the CRTC reads this discussion, I would be really irritated if I were to, at the end of the two years, look back and see that the CRTC had managed to get other regulations adopted and had not taken care of our pet project. I wanted to put that comment on the record for future reference.

The Joint Chairman (Mr. Grewal): Does "pet project" refer to the issue of licensing fees?

Mr. Lee: I am talking about the business of this committee. Hopefully, the CRTC would take into account our committee's objectives when drafting any future amendments and piggyback the easy ones on top of the hard ones.



(For text of documents, see Appendix J, p. 10J:1.)

The Deputy Chairman (Mr. Grewal): The next point on our agenda is SOR/95-191.

Mr. Rousseau: The committee had expressed doubt that the provisions of the regulations imposing reporting requirements could be passed pursuant to the legislative provision invoked originally by the department. As can be seen from the letter dated February 7, 2005, the department is now justifying these regulatory provisions by invoking another legal provision, i.e. section 208 of the Canada Nova Scotia Offshore Petroleum Resources Accord Implementation Act (CNSOPRAI Act). This section comprises a very broad regulatory power that allows the governor in council to make regulations compatible with the current part, as deemed necessary. The purpose of part III of the act is safety, among others. Clearly, the provisions on reporting requirements to be found in the regulation having to do with reports on events or situations that present a risk, or an accident, have to do with safety. The department's response is thus satisfactory and if the committee agrees, this file may be closed.

That said, committee legal counsel noticed that the French version of section 208 of the act contained some flaws. It would be appropriate to inform the Department of Justice of that, as well as the Department of Natural Resources, to have this corrected.


The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix K, p. 10K:1.)

Mr. Bernhardt: Mr. Chairman, this instrument states that the proposed amendments to the Canadian Egg Marketing Agency Quota Regulations, 1986, substantially in the annexed form, were submitted for approval to the National Farm Products Council. It was pointed out to the council that the Farm Products Agencies Act requires that amendments to the regulations actually made by the agency and not proposed amendments similar to those actually made be approved by the council.

The council replied that the reference in question was simply inaccurate and that such wording would not be used in the future. That would seem to resolve the matter.

The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.



Mr. Bernhardt: In her letter of June 9, 2004, the Minister of Labour indicated that the promised amendments would proceed as quickly as possible. Almost one year later, the committee is advised that the amendments are just about to be submitted to the Department of Justice for drafting. I suppose one could remark that this reflects an interesting view of what "as quickly as possible" means. That having been said, if members are satisfied, progress will be monitored as per usual.

The Joint Chairman (Mr. Grewal): Are members agreed?

Hon. Members: Agreed.



(For text of documents, see Appendix L, p. 10L:1.)


(For text of documents, see Appendix M, p. 10M:1.)


(For text of documents, see Appendix N, p. 10N:1.)


(For text of documents, see Appendix O, p. 10O:1.)


(For text of documents, see Appendix P, p. 10P:1.)


(For text of documents, see Appendix Q, p. 10Q:1.)


(For text of documents, see Appendix R, p. 10R:1.)

Mr. Rousseau: Mr. Chairman, I will proceed in the usual fashion and present together the texts regrouped under the headings "Action Promised" and "Action Taken." Five corrections were promised with regard to the four above-mentioned files. A correction was made to the first file and the new Saskatchewan rapeseed order corrects a French version which was totally defective.

Finally, may I point out that SOR/2003-89 abrogates the regulation on denatured alcohol which applied illegally to persons other than manufacturers and dealers of denatured alcohol. The committee had drawn this question to the attention of the authorities responsible for the regulation for the first time in 1988.

In conclusion, may I point out that 105 statutory instruments have been presented without comment.


The Joint Chairman (Mr. Grewal): Are there comments?

Mr. Lee: I want to congratulate our two counsel here today. They were extremely well prepared on the Canada cooperatives regulations and the plant protection regulations. We could not have gotten through those files without them.

The Joint Chairman (Mr. Grewal): They are always prepared.

Mr. Lee: I congratulate them for their work.

The Joint Chairman (Mr. Grewal): Is there any other business? This meeting stands adjourned.

The committee adjourned.

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