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Proceedings of the Standing Joint Committee for the
Scrutiny of Regulations

Issue 1 - Evidence, November 4, 2004

OTTAWA, Thursday, November 4, 2004

The Standing Joint Committee of the Senate and the House of Commons for the Scrutiny of Regulations met this day at 8:37 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): We are past our normal starting time. As everybody is always pressed for time, it will be our attempt in the future to start on time, as long as we have a quorum, in order to not rush things at the end.

We have some business before us. We must appoint a new vice-chair from the House of Commons. My co-chair will deal with that.

We also need a preliminary motion to official appoint a new counsel, to accompany the three counsels we have in staff positions.

The Joint Chairman (Mr. Grewal): Good morning. The first item that we will deal with is administrative. The second vice-chair, Ms. Guay, is stepping down. We must appoint a second vice-chair. Is my understanding correct, Ms. Guay?


Ms. Guay: Mr. Joint Chair, I hereby tender my resignation as Vice-Chair.


The Joint Chairman (Mr. Grewal): I will now take nominations for a second vice-chair.

Mr. Anders: I would like to nominate Ms. Wasylycia-Leis.

The Joint Chairman (Mr. Grewal): Is there another nomination?

Mr. Macklin: I move that nominations be closed.

The Joint Chairman (Mr. Grewal): All those in favour?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Congratulations, Ms. Wasylycia-Leis.

Ms. Wasylycia-Leis: I would like to thank the committee members, and my apologies to Ms. Guay for the confusion that led to this moment.

The Joint Chairman (Mr. Grewal): There is one more administrative item before us, and my co-chair will deal with that one.

The Joint Chairman (Senator Bryden): I would ask Mr. Bernier to comment on this item, please.

Mr. François-R. Bernier, General Counsel to the Committee: For new members of the committee, I will explain that the research branch of the Library of Parliament provides four of its positions to this committee. The fourth position has been vacant since the departure of Ms. Jodoin-Rasmussen. In the spring of 2004, steps were taken to fill that position, which involved the holding of a competition. The position was advertised nationally, through the Public Service Commission. If members desire a copy of the Statement of Qualifications, that statement can be distributed.

As part of the selection process, candidates were asked to undergo a written examination that was largely the same as had been used in a previous competition. The first part was a series of 10 questions designed to test a candidate's knowledge of the Statutory Instruments Act and of the general principles of administrative law. The second part consisted of 15 questions designed to assess the candidate's ability to scrutinize statutory instruments and to identify possible problems.

Eventually, some 33 candidates presented themselves for the examination. The criterion for passing the examination was 65 per cent on each part. Only Mr. Billingsley met this requirement, and he was invited for an interview by the board of selection, which consisted of a representative from human resources of the Library of Parliament, Mr. Bernhardt and me. The interview followed a structured format with questions designed to assess the candidate's knowledge and personal suitability. Following verification of references, the board of selection submitted its report to the Library of Parliament recommending that Mr. Billingsley be hired.

To complete the process, I would suggest, as the joint chairman indicated, that the joint committee formally appoint Mr. Billingsley as its counsel.

For those who are interested, Mr. Billingsley's CV can be distributed. I would indicate briefly that he is a graduate of the University of Waterloo with a Bachelor of Environmental Studies, and of the University of British Columbia with a Bachelor of Laws. He previously worked as a solicitor for the City of Toronto in their bylaw department.

The Joint Chairman (Senator Bryden): Are there any questions?

Mr. Myers: This is a full-time position, correct?

Mr. Bernier: That is correct.


Mr. Bouchard: Is he bilingual?

Mr. Bernier: The position requirements were B, B and B, and Mr. Billingslay met them.


The Joint Chairman (Senator Bryden): If there are no further questions, do I have a mover for the following motion:

That the Standing Joint Committee for the Scrutiny of Regulations appoint Mr. Rob Billingsley as counsel to the Joint Committee in accordance with the terms and conditions agreed to between the Joint Committee and the Library of Parliament.

Mr. Myers: I so move.

Senator Moore: I second the motion.

The Joint Chairman (Senator Bryden): All in favour?

Hon. Members: Agreed.

The Joint Chairman (Senator Bryden): Mr. Billingsley is here today. I would ask him to stand please.

The Joint Chairman (Mr. Grewal): Congratulations.

Let us move on to the items on today's agenda.


Mr. Peter Bernhardt, Counsel to the Committee: Amendments addressing the committee's remaining concerns in respect of these regulations have been prepared by the Canadian Transportation Agency. They were forwarded to Transport Canada for comment on February 26, 2003. In March 2004, the agency advised that they were still awaiting comments from Transport Canada on the draft. To date, the amendments have yet to be made. Hence, a follow-up letter asking when it is expected this might happen would seem to be in order.

If it does turn out that the draft amendments are still with Transport Canada, perhaps members might then wish to consider instructing the joint chairmen to write to the minister, to seek his help in moving this thing forward.

For now, it would seem to be a matter of following it up to see where things are at with the agency.

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

Do members agree with the recommendation?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Let us move to the next item on our agenda.




Mr. Bernier: Certain amendments of the Fisheries Act have been promised to the Joint Committee as a result of reports made by the committee in relation to both the Ontario Fishery Regulations and the Aboriginal Communal Fishing Licences Regulations. Those undertakings were eventually reflected in Bill C-33, a copy of which is attached in the material.

Among other things, the bill would have been provided clear legal authority for the imposition of penal sanctions for breaches of terms and conditions of permits, as opposed to breach of regulations. Also, it would have provided clear legislative authority for the regime that was put in place by the Aboriginal Communal Fishing Licences Regulations.

Many things have happened since the bill was introduced on April 30, 2004. The question is whether the committee wishes to instruct the chair to write to the new minister to ascertain what the government's intentions might be in relation to this proposed legislation, whether there is an intention to reintroduce the bill in the current session.

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

Mr. Anders: I have heard about this issue many times in the past. Admittedly, I have never served on the Fisheries Committee, but I am curious about something. Section 10(1) talks about compliance with terms and conditions of licences, leases, et cetera. What are the ramifications for non-compliance, because I understand there is some abuse of this system?

Mr. Bernier: If I may, Mr. Chairman, that is the provision to which I referred. I will give you the consequence first. If the individual does not comply with the terms and conditions of licence, he is automatically in contravention of section 10(1) of the act and, therefore, can be subjected to the penal sanctions set out in the statute for a breach of the act, which is imprisonment or a fine, up to certain stated maximums. That was put in precisely in order to address the issue raised by the joint committee.

In the late 1990s, Fisheries and Oceans started to put in the regulations an obligation to comply with terms and conditions of the licence — pretty well what you see here.

The purpose of that was that if you did not comply with terms and conditions of a licence you were committing a breach of the regulation and you could be subjected to the penal sanctions. Normally, you would not apply penal sanctions to a breach of an administrative-type document like a licence. The sanctions would be administrative. You would have either a cancellation or a suspension of the licence.

Here, the desire was to punish the breach of a licence condition in the same way as you would punish a breach of a statute or a legislative instrument.

Mr. Anders: I understand. You are saying that this is some how tightening it up; is that right?

Mr. Bernier: Yes. On the level of legislative policy, some people might disagree and, as a matter of principle, say that breaches of terms and conditions of licence should not be subject to penal sanctions. They may say that penal sanctions should be reserved for —

Mr. Anders: I am fine with the aspect of tightening it up; I think that that is fine and commendable.

I would like to follow up on the intention. You talk about fines or imprisonment. How many times have individuals fallen out of compliance? Are there any minimums or maximums in the actual statute? How many people have ever been subjected to it? What are the real fines and condition that are imposed?

I am trying to assess, if we are making a change to the regulation, what is being done with it currently?

Mr. Bernier: Enforcement information is something about which we would have to ask the department. We can do that. I do not have that information at hand.

The imprisonment is up to a maximum of six months, and the fine is — do you recall, Mr. Bernhardt? The maximum fine is in the thousands of dollars.

Mr. Anders: Do we make this change in the regulation based on problems that the enforcement agencies have had with regard to this particular item?

Mr. Bernier: Let me clarify here. This is not a change in the regulation. This was a bill. This would be an amendment to be made by Parliament to the Fisheries Act.

Mr. Anders: Forgive the nuance that I use there. Is the amendment that we are making to the statute because of problems the enforcement agencies have had with this particular piece of legislation?

Mr. Bernier: No, the change to the statute would be made because this committee has reported to the Houses that the inclusion of this type of provision in regulations — as opposed to it being done by Parliament in the statute — was illegal.

Mr. Anders: We are changing it from being something that was regulatory to being statutory.

Mr. Bernier: Exactly.

Mr. Anders: All right.

Senator Moore: In Minister Regan's letter, he writes:

...I would appreciate hearing the Committee's views on whether the amendments as proposed in Bill C-43 address the Committee's issues.

We had already canvassed those ideas. We were in agreement and approved of the draft bill, did we not, in the last session?

Mr. Bernier: Yes. The reply to the minister is there, dated April 14, 2004. The chair indicated to the minister that the bill, which was Bill C-43, the predecessor to this one, would cover the matters dealt with in the two reports.

The committee, however, specifically indicated that this letter should not be seen as indicating support necessarily or an endorsement of the section that we just discussed, that is, section 10(1), that this was a matter of legislative policy and that it was up to the Houses to decide on the desirability of making this change.

Senator Moore: What do we do now? Do we ask the minister to introduce the bill?

We want to get this done. This was a very contentious issue. I thought we had the thing moving to a final solution.

Mr. Bernier: There were events that intervened.

The Joint Chairman (Mr. Grewal): Any other comments?

Do members agree that a letter be written to the minister to know the minister's intention and, in fact, put some pressure on him to introduce the proposed legislation as soon as possible?

Mr. Bernier, would the letter be similar to the letter written on April 14, 2004?

Mr. Bernier: I am sorry, Mr. Chairman. I am not sure that I follow.

The Joint Chairman (Mr. Grewal): Would the letter that will be written to the Minister of Fisheries and Oceans be along the lines of the letter this committee wrote on April 14, 2004?

Mr. Bernier: At this point, the purpose of the letter would be to ask the minister whether the government intends to reintroduce this bill.

Senator Moore: If not, we could introduce the proposed legislation in the Senate. That is a thought.

Mr. Bernier: Do you want that suggestion to be conveyed to the minister?

Senator Moore: No, I am just putting that before the committee. I do not want this matter to be stalled any longer. We did a lot of work on this particular bill, and I would like to see it advance.

The Joint Chairman (Mr. Grewal): Just for the information of new members, this issue has been rigorously debated in previous sessions of this committee.

Senator Hervieux-Payette: It is a very long story. I support Senator Moore. I believe, given the agenda in the House and what we have in the Senate, that if a new bill is introduced it would proceed quickly and without contention. If the opposition parties support the bill, it could move through quickly.

The Joint Chairman (Mr. Grewal): Could a bill go simultaneously through the House as well as the Senate?

Senator Hervieux-Payette: No, but the whip could agree to submit it to the Senate first, because it will return to the House. It could be passed quickly. I do not think there would be many hearings on this. It is more or less a technical matter that would solve a long-time problem. I believe it would be fair to all of the people in this area for us to proceed diligently.

The Joint Chairman (Mr. Grewal): Senators can pursue that matter.

However, in the meantime, for the purposes of this committee, we should write a letter to the minister.

Senator Hervieux-Payette: I agree with that. I am saying that once the minister agrees, he needs a speedy way of moving the issue along. Senator Moore is quite right by saying that this could be dealt with quite fast in the Senate.

The Joint Chairman (Mr. Grewal): With due respect, I do not believe we should mention this in our letter to the minister. However, that could be a possibility.

Senator Hervieux-Payette: It is up to you to discuss that with your colleague.

The Joint Chairman (Mr. Grewal): It would appear, therefore, that committee members want counsel to go ahead and prepare a letter to the minister in this regard.

Let us move on to the next item on our agenda.


Mr. Bernier: Mr. Chairman, the committee had concerns with respect to the delay that occurred, as well as the reasons for the delay, in complying with the disallowance resolutions adopted by the committee on May 17, 2001. These concerns are detailed in the letter of September 16, 2002, to the President of the Privy Council.

Of course, in light of the enactment of a statutory disallowance procedure by Statutes of Canada 2003, Chapter 18, as section 19.1 of the Statutory Instruments Act, the concerns raised are now moot. I need not comment on the reply received from Mr. Dion.

Under the new procedure, a regulation-making authority will be under a legal obligation to revoke within 30 days of the adoption of a disallowance resolution by both Houses. There could be, I should add, a longer delay, but only if allowed or provided in the disallowance resolution itself.

On this basis, I would suggest that the file can be closed.

The Joint Chairman (Mr. Grewal): Any comments? Are members agreed that this file be closed?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Let us move to the next item on our agenda.


Mr. Bernhardt: Mr. Chairman, the correctness of the English name of a particular disease was questioned. The Canadian Food Inspection Agency has explained that the name used is indeed correct. This morning, the file is submitted to the committee for the information of members. No further action is required.

The Joint Chairman (Mr. Grewal): Is there anything we are waiting for, in order to close the file?

Mr. Bernhardt: The explanation is fine.

Mr. Bernier: It is a French-only disease, Mr. Chairman.

The Joint Chairman (Mr. Grewal): Any comments?

Let us now move to the ``Reply Unsatisfactory'' portion of our item.


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

Mr. Bernhardt: Mr. Chairman, at the outset I should note that the French translation of the second page of the Food Inspection Agency's letter of December 11, 2001, was omitted from the materials as printed. Copies of the full translation of that letter are available this morning.

With members' agreement, I can proceed with the item, if that is the wish of the committee. Otherwise, we can defer it until later, if members feel they would rather do that.

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

Senator Moore: Proceed.

The Joint Chairman (Mr. Grewal): I think we can move ahead.

The Joint Chairman (Senator Bryden): If I may, anytime we say we will move ahead, we should say ``yes,'' I know.

I do not think there is any particular urgency with this matter; is that correct?

Mr. Bernhardt: No. The page that was missing, Mr. Chairman, was a couple of paragraphs.

The Joint Chairman (Senator Bryden): Are those paragraphs available now?

Mr. Bernhardt: Yes. Hence, I am in the hands of members as to whether the committee wishes to defer or to proceed.

The Joint Chairman (Senator Bryden): We should just take a minute to look at those two paragraphs, to ensure that we are satisfied. Otherwise, we will defer the matter to the next meeting.

Mr. Hanger: Which paragraphs are we speaking of? I have only a series of letters and the bill before me. Which paragraphs are in question?

Mr. Bernhardt: One should turn to the French version and compare it with the English version of the December 11, 2001, letter from Mr. Tremblay of the Canadian Food Inspection Agency — the final page. There is a second page to that letter in the English version, which begins as follows: ``For example, to grade seed means to...''. The French translation of that page was omitted from the materials.

Mr. Bernier: You have everything, Mr. Hanger, in the English version.

Mr. Hanger: It is just the French version that is in error, you are saying.

Mr. Bernhardt: The English version is complete.

The Joint Chairman (Mr. Grewal): With the addition, the French version is also complete.

Do members agree that we can proceed on this matter?

Hon. Members: Agreed.

Mr. Bernhardt: On SOR/396-252, the issue concerns section 14, which imposes a number of record-keeping requirements on people who sell, condition, sample, test grade or label seed for sale.

The committee has always taken the position that the imposition of information-keeping requirements requires express enabling authority. That position has been accepted in a number of instances. In this case, however, the agency, although conceding that specific authority is lacking here, seeks to argue that, in its words, ``sufficient authority'' can be found in the Seeds Regulations nevertheless.

In essence, the agency's position rests on two grounds. The first is that because the act confers a power to inspect books and records on inspectors, this must presuppose the existence of documents, which in turn must imply the authority to require the keeping of documents.

This argument has been raised before and has been dismissed by the joint committee in the past. The power to inspect records and the power to require the keeping of records are two distinct things. The one does not follow from the other. Conferring a power on inspectors to gather documentation to enforce the act does not mean that there must be a power to make regulations requiring that documents be kept any more than conferring a power on the police to obtain a warrant to search a premise implies a power to require that the person occupying the premises makes sure he has evidence there at the time. A record-keeping requirement is a substantive duty. It must be authorized either expressly or by necessary implication. It cannot be justified on the grounds of being inferred or ancillary to some other regulation-making power.

The agency also tries to claim that if records are not required to be kept, the application, enforcement and administration of the act would be impossible. The fact is, however, that the Seeds Act was passed in 1959. These provisions were put in the regulations in 1996. There was, therefore, a period of 37 years where apparently it was possible to administer the act and the regulations without these requirements.

As counsel pointed out in the October 29, 2002, letter, the perceived need for record keeping requirements arose not from the scheme set out in the act but rather from the decision to change the way in which the act was administered and enforced, namely, by transferring these functions to the private sector. The agency failed to go to Parliament to seek the authority on which to found a new regime it wanted to put in place.

In conclusion, I would suggest that this issue be pursued in a further letter to the agency.

Mr. Anders: I am trying to wrap my head around this. Let us pretend I am a seed producer and that I am working on various strains of seed. What kind of records would the Food Inspection Agency want from me?

Mr. Bernhardt: These would be records of grading, inspections, various certifications on different batches and varieties of seeds, the labelling records of labels that had been affixed to packages of seeds, et cetera.

In the past, like most statutes, enforcement had been carried out by government inspectors, who would arrive on the premises and carry out the inspection. Hence, there would be no need to keep the records. The people who would keep the records would be the government officials who had done the work. In 1996, the decision was made to download these functions on the industry — a kind of self-regulation, if you will. That gives rise to the need for these people to keep records so that the government can verify that the self-regulators are regulating properly.

That is all well and good, except that in the process of trying to shoehorn the new regime into the old statute you find an absence of this power to require people out there in the private sector to keep records.

The Joint Chairman (Mr. Grewal): What counsel is saying can be found on page 1676 of the Seeds Act, section 14(1), which indicates what records are required.

Is that satisfactory, Mr. Anders?

Mr. Anders: I only worry that we are busting the chops of some seed producer out there who wonders why he has to keep records for the government.

Mr. Bernhardt: The answer to that is that if it is considered a good idea that somebody should busting someone's chops, it should be Parliament that gives the authority to do that rather than government taking it upon itself. That is the crux of the concern of the committee. If you want this kind of power, Parliament must give it to you expressly. Parliament has not done that yet. It is up to Parliament to decide whether it wants to give it to you.


Mr. Bouchard: We are dealing with a situation where retailers or producers are regulating themselves. I assume government officials conduct audits. First of all, is there a specific audit procedure that is followed and secondly, how frequently are the audits conducted?

Mr. Bernier: To be quite honest, I have no idea. That is a question we should put to the department. It is a practical question having to do with the application of the regulations. If you like, we can put the question to the department and get back to the committee with an answer.

Mr. Boucher: I assume that there are two parties. The private sector, that is the producers and the retailers, regulate their own activities...

Mr. Bernier: That is correct, which prompted to the need to impose a number of record-keeping requirements. When government inspectors carried out the inspections, they would arrive on the premises and ask producers to turn over their records. Now producers are being asked to carry out their own inspections and to regulate themselves. In order to be able to ascertain from time to time whether they are doing their work properly, we have imposed a record-keeping requirement.

Mr. Bouchard: Government officials check occasionally to see that they are complying. Correct?

Mr. Bernier: I would imagine so.


Mr. Hanger: My question is along the same lines. If there is an industry, in this case, agricultural, that is in a competitive market — and much of that market, I would assume, is international, where you would be competing with not only local growers but also on an international level — is it not just adding another level of restriction or cost to the producer, to have to meet government regulations instead of allowing the free-market system to deal with it? For example, if it is to develop a standard, would those standards not be met in the market system itself?

Mr. Bernhardt: That may well be, Mr. Hanger. Our concern is with the legality of the regulation. Whether that regulation is a good idea or a bad idea from a policy point of view is a matter for Parliament to decide.

Mr. Hanger: Whose idea was it to give this additional power?

Mr. Bernhardt: The Canadian Food Inspection Agency.

Mr. Hanger: The agency did. It is coming from the agency and not through Parliament. Parliament did not ask for this to happen, I gather.

Mr. Bernhardt: No, it was made by regulation. The committee's concern is that that regulation is not presently authorized under the terms of the enabling statute, which is the Seeds Act. If the agency wants to do this, it needs to go to Parliament and ask for the authority to do it. At that point, presumably Parliament will make some policy judgment as to whether it considers this an appropriate power to give to the Governor in Council.

Mr. Hanger: Why then are we sitting here debating whether they should get the power? Why is it coming to this committee?

Mr. Bernhardt: The issue is not whether they should get the power; the issue is that now they have made an illegal regulation. That is the issue before this committee.

There are, therefore, two options open to the agency. Having made an illegal regulation, it can revoke that regulation; or it can determine that it really wants this regulation and therefore must get authority for it. How would they get authority for it? They would go to Parliament to get the authority. The option is theirs.

Mr. Bernier: Mr. Hanger, I would ask you to look at the last full paragraph on page 2 of my October 29, 2002, letter to Mr. Pierre Tremblay. It explains the shift that has taken place. The Seeds Act, when Parliament passed it, was predicated on a model under which you had a grading scheme that was enforced and verified by government inspectors. Parliament gave the powers necessary for that scheme to operate.

At some point, in 1996, due to downsizing and other factors of which I am sure you are aware, the department decided to change this scheme to have the private sector do its inspection, verification and grading.

That was a fundamental shift in the structure. Normally, you would have expected the agency to go to Parliament and say: ``The Seeds Act as enacted by Parliament in 1959 no longer meets the needs of seed producers,'' and so on. The agency did not do that. Obviously, if you go to a system of self-inspection and regulation by the private sector, you then need to force them to maintain records.

Mr. Anders: Why?

Mr. Bernier: You must be able to verify that they are complying with the grading requirements. There are still grading requirements that must be followed. That is what guarantees the quality of our product on international markets, and so on.

Mr. Anders: It is the marketplace.

Mr. Hanger: A friend of mine had a run-in with the Wheat Board. He swore that he would never involve himself with the Wheat Board again, so he set about to establish a complete new industry in Western Canada, which was to grow lentils in the region that he farmed. He grew lentils. In short order, he expanded his market. He went to Europe and laid out his product at their trade shows. He looked at the product of his competitors, and said, ``I can do better.''

This is the industry regulating itself. He put forward a superior product to all of the competitors he had internationally. Out of all of that effort, he established a lentil market for Canada.

Why would a regulator want to insist upon building up this additional bureaucracy, if you will, to regulate something that was established by the industry and is competitive on the world market? Would the world market not be more important than any bureaucratic regulation scheme?

Mr. Bernier: All I can give you as an answer is not much of an answer. That is a policy question, and it should be directed to the people employed in the Canadian Food Inspection Agency. We only deal with the regulations that come out of the executive branch, and we verify them for legality and conformity to the enabling statute, to the will of Parliament as expressed in statute. That is the mandate of this committee.

Obviously, a number of interesting policy questions can arise as part of this, but they have to be addressed, I would suggest, in the agricultural committee.

Mr. Hanger: These two options exist here, however: revoke or put forward a statement in reference to authority.

Mr. Bernier: If they seek the authority by seeking an amendment to the Seeds Act, they would have to explain to Parliament, presumably, why they need the new power. It could be because they changed the inspection structure. Parliament would then be free to say, ``No, we are not passing this legislation,'' which would indicate that it does not agree with that policy approach. Parliament may say, ``We want you to do it differently,'' or ``We want you to keep doing it the way you would.''

The decision would then be made by the sovereign Parliament.

Mr. Hanger: What can this committee do in reference to the two options?

Mr. Bernier: The options are those of the executive branch. This committee points out that what is being done in this instance is illegal, is ultra vires in the view of this committee. Which solution they choose is the prerogative of the executive branch and the Canadian Food Inspection Agency.

Mr. Lee: First, I want to get into this concept of inferentially finding the authority to require the records. Is there a pinch point in the regulatory framework involving the management of seeds where it would be obviously necessary to have records? Is there a pinch point involving a certification or an authorization? Is there a green light where, in the absence of records, it would be impossible to give certification?

If that is the case, the whole system stops if there are not records made of what is happening with the commodity. Is the department able to say, ``The whole system breaks down if we do not have the records and, therefore, we have to give some guidance to our seed producers, so that they have records, and we have done it by way of regulation''? I suppose I could ask this: Could they have not done a regulation but given a guide book to seed producers, to explain how to obtain certification and make a record. In that way, if they do not make a record, they are not given certification.

Mr. Bernhardt: I presume that is what happened between 1959 and 1996. That is a telling factor. The regime that was set up in 1959 worked until 1996 without these requirements. Somehow this scheme muddled along. I find it a bit disingenuous for the agency to say now that this act cannot be applied unless we have these requirements. It begs the question: What did you guys do for 37 years? We can only presume that somehow they managed to make it work up until 1996. The answer is, in 1996, they decided they wanted, for lack of a better word, to privatize the inspection system. That raises a question: Who inspects the inspectors? It goes from there.

The fact of the matter is that when the act was passed by Parliament in 1959 no one contemplated that kind of an inspection — a private-sector inspection. It was an unknown concept in 1959.

Mr. Lee: I accept the staff's conclusion — I have read it — that there is no explicit authority to impose these regulations as they are written now.

In the rest of the world of regulatory affairs, to your knowledge, has any other department, as a result of privatization and downloading, et cetera, fallen into the same paradigm, whereby the department has evolved a set of guidelines for the use of the private sector, whether or not it has fallen into a regulation. Are you aware of any such thing in other regulatory envelopes?

Mr. Bernhardt: In terms of administrative guidelines that an industry or a business must follow in the hopes of getting a certain approval or verification, you do see that kind of a regime in the financial sector. This committee has dealt with bank guidelines in the past. There are various instruments that the Superintendent of Financial Institutions puts together to advise banks of the kinds of best practices that they are expected to follow.

Mr. Bernier: However, if a non-regulatory approach is to be adopted, we are less likely to be aware of it, because we see what is in the Canada Gazette, the regulations.

Mr. Bernhardt: This particular problem has come up a number of times in the area of agriculture. You see this in feeds, fertilizers and seeds, et cetera.

Mr. Lee: In any event, the department in this case is persisting in not listening to our view; rather, they are listening to it, but they have not acquiesced.

Mr. Bernhardt: Precisely.

Ms. Wasylycia-Leis: I wanted to add that this has come up a number of times as part of this whole agenda to move the regulations to industry. In effect, it becomes deregulation through the back door. It seems to me that whether or not we agree with the regulatory approach to seeds, the current legislation and Parliament's will is for a regulatory approach. Hence, in order to deal with this matter, we must send it back so that Parliament will say in which direction it wants to go. It seems to me that the agency has dug in its heels. The last paragraph of the letter of June 9, 2003, suggests that they believe they are on the right course and are doing the right thing. They do not accept the supremacy of Parliament in this respect. Therefore, I would think that the committee would want to send it back to Parliament for final say.

The Joint Chairman (Senator Bryden): There may be no question that they might have chosen to deal with this in another manner. However, they have chosen to deal with it by using the regulation-making authority that was created for another regime and stuff this new one into it. I went through it pretty carefully, and it does not fit. So they have got to do something.

Our job is to determine whether the regulations before us are valid and are authorized by the existing statute. They attempted to do something that is not legal, in the opinion of counsel and hopefully of the committee, within the authorization that they have.

If they want to come back and try a guideline system or something else, that is fine. We can suggest what is being suggested here — that is, either drop it or take it to Parliament to obtain the authorization to do what they are asking to do.

Mr. Anders: I sense a power grab in this. I do not know why they need to do it. When I toured Pickseed in Ontario — Pickseed develops hundreds, if not thousands, varieties of grass strains and has a little crop of land down in an Oregon temperate rain forest to test all this stuff. It can be good grass or bad grass. I do not know why these guys need the authority to force them through a regulatory or administrative burden nightmare with regard to labels. I do not see the point; I do not know why they need it. I am not a seed producer, but it seems like a great deal of work and cost.

Mr. Lee: We could craft correspondence to the department. Listening to colleagues around the table, I think we have pretty much come to the conclusion that the department will not be able to persist in maintaining it has legal authority for the regulations. We should allow counsel to draft that position, put it to the Food Inspection Agency, and then the agency can get back to us. Do we have a firm turnaround time for dealing with agencies now? Is it 30 days or 60 days? We would then take the next steps. That would be my suggestion.

The Joint Chairman (Mr. Grewal): There is consensus to write a letter.

Mr. Hanger: I do not know if Mr. Lee thinks he is talking on behalf of everyone at this table.

Mr. Lee: No.

Mr. Hanger: I would suggest that there are two options on the table, from what I see: One option is to revoke; the other is to write this letter assisting the agency to get the authority they need to administer the act, with a change to it.

I am of the mind that a businessman should be free to operate in a competitive nature with his international colleagues and to do business as efficiently as possible without the regulation. In other words, throw the thing out. That is my point.

I do not understand why you want to tie up Canadian businessmen with a series of unnecessary regulations.

Ms. Wasylycia-Leis: I am of the opposite opinion, but that is neither here nor there. The role of this committee, as I understand it, is to let Parliament decide. We are saying that the committee can send a letter back and ask Parliament to clarify. The Agriculture Committee will get involved, and we will resolve it. That is the only approach for us to consider.

Senator Moore: That sums up my position as well.

The Joint Chairman (Mr. Grewal): I believe that instead of writing to the Food Inspection Agency, we will write to the minister to convey our message. Then we will move forward. Would that be the consensus?

Mr. Bernier: I am unclear on the second option, Mr. Chairman. Correct me if this does not fit what you are saying. Normally, the committee would write to the minister to explain why the reply received was not satisfactory and that the committee maintains its position that these regulations are not authorized.

How to correct this would be left to the minister and the executive. They are the government; they are the ones who make the policy choices. It is their choice to simply revoke the regulation or to go to Parliament. Normally, the committee would not indicate a preference.

The Joint Chairman (Mr. Grewal): I think the consensus of the committee is to write a letter to the minister rather than the agency. Let us move it one step higher. Depending on the response, the committee will have the opportunity to discuss it again.

Fair enough?

Mr. Hanger: If I may seek further clarification, that letter will strictly point out the shortfall and not make recommendations. Is that basically it?

Mr. Bernier: That is correct. That would bring us into policy, which is not the role of this committee.

The Joint Chairman (Mr. Grewal): Counsel will draft a letter.

We will now deal with the item under ``Progress.''


Mr. Bernhardt: Mr. Chairman, the need for a number of amendments to these rules was accepted by Industry Canada in February 2001. More than two years later, the department indicated that, while it did still intend to proceed with the amendments, it had not yet instructed the Department of Justice to prepare them.

The committee's concern with this delay was communicated to the department in counsel's letter of September 8, 2003. In its most recent letter, February 13 of this year, the department advised that drafting instructions had been given.

We are still awaiting amendments. At this time, it would seem that an updated progress report should be sought from the department.

Senator Moore: Can we ask that we get a response within 30 days, counsel? Let us not let this drift along.

Senator Hervieux-Payette: I agree with that.

The Joint Chairman (Mr. Grewal): We will tighten it up, give them 30 days to respond.

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): We will now move to the part of the agenda entitled, ``Progress.''



Mr. Bernier: Mr. Chairman, the committee wanted to know what progress was being made in the enactment of a few relatively minor amendments promised by the Nuclear Safety Commission in January 2002. In their letter to us, they say, these amendments ``will be considered in due course on the basis of risks to health, safety and security (among others), and available resources.''

We would suggest that a further letter be sent asking for a more precise indication of the timetable for making the corrections identified by the joint committee and pointing out to the commission that the miscellaneous amendment process is available and was designed specifically for the speedy processing of minor amendments of this kind.

Mr. Lee: Just so the record is clear, we are trying to communicate to them that we do not carry a file around here for nothing or forever. I agree with counsel's suggestion.

The Joint Chairman (Mr. Grewal): Counsel will write the letter.

The next section of the agenda is entitled ``Part Action Promised.''


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

Mr. Bernier: A drafting correction is promised in relation to section 119(3) of the regulations. The reply on the other three points of drafting can be accepted as satisfactory.

The Joint Chairman (Mr. Grewal): That means the file will be closed.

Mr. Bernier: The actual enactment of the promised direction will be monitored.

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Excellent.


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

Mr. Bernier: Mr. Chairman, in this file, amendments are promised on the issues raised under points numbered 1, 2 — the first paragraph — 3 and 4 of Mr. Bernhardt's letter. An explanation has been provided regarding the use of the social insurance number as an identifier. A question had been raised in this regard in the second and third paragraphs of point 2 of the October 3 letter.

Turning to point number 5, while the reply does not really explain the relationship between 22(a)(i) and 22(a)(ii), there is a general undertaking to ``clarify'' the wording of that provision.

Finally, in regard to point number 6, the requested explanation has been provided.

With the agreement of the committee, progress on the promised amendments will be monitored in the usual way.

Hon. Members: Agreed.


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

Mr. Bernhardt: Amendments have been promised on all the points of the correspondence, save for point 3. This concerns paragraph 12(o) of the regulations. On its face, this provision appears to require an application for certification of a device to include information that will only be known to be required after the application has already been made.

The Nuclear Safety Commission has replied that it understands the problem, but, in practice, this timing does not present any difficulties. Presumably, this is because, if additional information is required, the applicant is simply told to add it to the application after.

This is perfectly logical, but it could be suggested, perhaps, that if this is the practice of the commission they could amend the regulations to at least reflect what they are actually doing in the real world. Such an amendment could be added to the other promised amendments. These have been forecast to be made by the end of 2005.

If members are in agreement, it would be simply a matter of writing back to the commission to advise them of this.

Hon. Members: Agreed.


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

Mr. Bernhardt: We are back to more amendments to the seeds regulations.

Under the seeds regulations, you have a scheme involving what are called conformity verification bodies. These bodies are given a monopoly on the administration of certain functions. The functions that are relevant are the assessing of applications for the registration of establishments, the licensing of operators and samplers of seeds and the accreditation of graders.

All of these things — licensing, registrations, accreditations — may only be made on the recommendation of the conformity verification body. Currently, the only such body is the Canadian Seed Institute. The registrar is required to act in accordance with the recommendation of this body.

The Canadian Seed Institute has established fees that have to be paid by people seeking its recommendation. The agency characterizes these fees as being charged on a contractual basis — that is, there is an implied contract between the institute and the applicant.

Given that these fees are somewhat compulsory in nature, in the sense that the institute is the only recommending body, if you wish to engage in a regulated activity, you have to go to that body to get a recommendation. The registrar has to comply with the recommendation of the institute. It is somewhat questionable whether you could argue that these fees must not be fixed by the agency itself. On the other hand, applicants can appeal a decision to refuse a recommendation, and the registrar has discretion to register in the absence of a recommendation.

Given these things, the matter is not entirely free from doubt, but perhaps the agency's response on this question of contractual fees could be accepted as satisfactory in this case.

If that is the view of the committee, it only remains to monitor the progress of the correction promised to 13.1(7) to 13.1(13) of the regulations. We do this in the usual manner.

The Joint Chairman (Mr. Grewal): What is the nature of this fee?

Mr. Bernhardt: It is basically a fee imposed by this private institute, and it charges a fee for its service as it would characterize it. In this case, the service is deciding whether you get a recommendation. If this were the government doing this, you would expect there to be a formal fee imposed. In this case, the argument is that it is a contract in each case.

The Joint Chairman (Mr. Grewal): Is this institute a non-profit organization?

Mr. Bernhardt: Yes.

Mr. Bernier: It is an industry —

Mr. Bernhardt: It is a non-profit industry group.

Mr. Anders: First I smelled the power grab, and now there is money involved. It sounds like a government trying to establish itself. I do not know enough about seeds, but something funny is going on.

Mr. Bernhardt: Again, Mr. Anders, this is another aspect of what we saw earlier with the self-regulation model. Basically, the CFIA has said to industry that it will let the industry decide who receives licences. Government will register the business on recommendation from the industry. Thus, this institute has been created, which is basically an industry group, to do this work. Obviously, the institute agrees to do the work, but someone has to pay for it. The government is not willing to pay for it, so they decide to fund it themselves — that is, the seed industry. When each member applies for accreditation, they will pay a shot to this institute that is set up as a non-profit body.

Mr. Hanger: The industry is crying for this; or is the CFIA crying for it?

Mr. Bernhardt: We do not know. From a policy point of view, that is the $64,000 question.

Mr. Lee: Have you any sense of the quantum of the fee? Are we talking about $10 or $1,000?

Mr. Bernhardt: The only indication we have is from cited examples. There is a BSF renewal fee of $190.

The Joint Chairman (Mr. Grewal): What page is that?

Mr. Bernhardt: This is in the regulatory impact analysis statement of the materials provided, on page 525. This is in the section entitled ``Description.''

Mr. Lee: We have something in the nature of a user fee charged by a private-sector organization that fulfils a regulatory function.

Mr. Bernhardt: There were formerly fees set by the CFIA when it performed this function. Then, for a time, the industry had a choice: They could pay the agency and go through the agency process, or they could pay the institute and go through the institute process.

The problem was that most people in the industry preferred to go through the agency, because their fees were lower than the institute's fees. The government's response to this was to simply get out of the business.

Mr. Lee: In any event, if what is out there is a reasonable fit, if not a perfect fit, in the regulatory template, and if the only other issues are the other ones that Mr. Bernier mentioned, then I suggest we accept what is there and deal with the amendment suggestions that were made earlier.

Mr. Anders: I would like the opportunity to contact some seed producers to know what their thoughts are on this, before we go ahead and rubber stamp this. I would be willing to undertake that, by the time we have our next committee meeting. Is there a way that we could put this aside until then?

Senator Moore: That is policy, again.

Mr. Lee: Could I suggest that we allow counsel to proceed as suggested but leave a window open for Mr. Anders to bring back this issue, in the event his consultations yield something on the Richter scale that we should look at.

Mr. Hanger: I would like a little more time on this myself. Mr. Anders is not the only one. There is a matter or two I would like to pursue. I looked at the regulatory impact statement in the Canada Gazette, Part II.

I would like to verify that this will not do even more damage to the industry, in the sense that it is another burden that they have to bear unnecessarily.

Mr. Lee: We could simply defer it. Mr. Hanger does not want to deal with it now.

Ms. Wasylycia-Leis: There are many kinds of policy issues we could discuss. I am just not sure it is the place of this committee to do so. I would love to ask more questions. For example, if the fees were lower with the CFIA than with the new institute, why did we do the off-loading in the first place? I would like to discuss issues around the institute, which is paid for by the industry, now regulating the industry being a conflict of interest. That is the role for Parliament and committees but not this committee, I presume, unless we are having policy discussions.

I would think that we would have to go with the recommendation, move this along and have the debate somewhere else.

The Joint Chairman (Mr. Grewal): I did not want to say in the beginning what the mandate of this committee is. I know there are many new members, so I was being lenient as we went through these issues, with the appropriate discussion. Of course, the mandate of this committee is not related to policy, I would remind all members.

I would suggest to the many new members on this committee to review the yellow book and highlight those 11 or 12 criteria based on which we have to scrutinize those statutory instruments. That will help to provide guidelines on the direction of this committee.

On the other hand, some valuable points have been made. We will leave the window open. In the meantime, because we have spent time on this, I would like the committee to move forward, with a step in the right direction, which would be that we follow the request of members to write and follow through. As we go through the consultations and hear some meaningful outcome, if we have to revisit it, then we can do that, if something is related to the validity of the statutory instruments.

In the meantime, keeping policy issues aside, we will move forward with the legality of the regulations.

Senator Hervieux-Payette: I have a suggestion. These regulations were certainly reviewed for the 30- or 90-day period when they were tabled originally. The industry has had time to present their comments and indicate whether they agree or disagree. There is a review process for the substance of regulations. That has taken place. At the end of the day, when it comes before this committee and it has been approved and in force, we review the regulations to ensure that they are in agreement with the law.

I am also interested in designing policy, but that is in the hands of the Agriculture Committee. On the regulations, the process is the 30- or 90-day review by any party that would like to express their opinion.

I see that we have 17 other pieces to review today, and we adjourn at 10 a.m. usually. I have been on this committee for eight years. Our mandate is to ensure that the government is respecting the House of Commons and the Senate by making sure the regulations are in compliance with the law. That is how I see my role.

Mr. Anders: I just want to make my reservations clear. For example, while Ms. Wasylycia-Leis and I may have differences in terms of policy, I feel that many of these issues are jurisdictional. That is the root at which I approach it. When an agency asks for power, I wonder whether it truly deserves that power.

I have not read through the yellow booklet yet, but I am certain that whether Parliament should be making this decision or whether the agency should be making the decision is relevant to this committee. It is hard for me to determine that without talking to some of the people in the industry, to determine whether the regulatory body is ultra vires the mandate given them by Parliament — if they are assuming more power than they were intended to have.

Mr. Hanger: I am a bit surprised actually that there is not a different view held generally by the committee. There is an opportunity of a lifetime here to start allowing the business community, even government, to do business better and to make some changes, not only in the regulations but also the process in which it is handled.

I am holding here what, I believe, was submitted to every member in this committee meeting, that is, information on smart regulations, to improve the way Canada does business and to save our businessmen, our government and our taxpayers money. If we have to burden them down with the status quo every time there is a regulation that comes here without question, then we will end up with a huge bureaucracy on every item that some bureaucrat or politician sitting in this place feels he wants to generate against someone else. For what?

If we are not allowed to question the regulation that comes to bear on our community and the economy, then we are all just rubber stamping it, and we may as well just go home. I might as well.

The Joint Chairman (Mr. Grewal): Mr. Hanger, the steering committee will review these recommendations, and, if need be, we will follow through with it later.

Is there a consensus to have counsel proceed as suggested?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): In the meantime, if there is anything following up from the discussion or further consultation, please bring that to the attention of counsel or co-chairs. We can revisit those issues later on.


(For the text of document, see Appendix F, p. 1F:1)

Mr. Bernhardt: Mr. Chairman, an amendment has been promised to resolve the English-French discrepancy noted in point 2 of counsel's letter of October 20, 2003. Two matters were raised in point one of that letter.

The first concerned section 2(1)(a). This provision makes it a condition of a grower's eligibility for compensation that a grower report a taxable farm income from tender fruit sales in the immediately preceding year — that is, the year in which a notice to dispose of or treat a tree was received.

The question was asked why a grower who has no such income should be ineligible to receive compensation. The Canadian Food Inspection Agency has replied that it interprets taxable farm income to mean any income at all from tender fruit sales.

First, one wonders why this is not what the regulations actually say. More to the point, it simply does not address the question that was raised, which is why a grower with no income in the previous year should not qualify for compensation.

The agency also advises that such a situation has not arisen to date and may well not arise in the future. Again, this does not answer the question that was asked.

Also questioned was section 4(d). This requires an application for compensation to include a copy of the grower's income tax return for the previous year. The agency has explained the rationale for this requirement and has stated that it intends to review the nature of the documentation it requires. Again, this fails to explain how this provision is thought to be consistent with the provisions of the Privacy Act and Treasury Board guidelines on the collection of personal information.

I would suggest a further letter to the agency following this up. At this point, it is difficult to proceed any further, not having had answers that actually addressed questions that were asked.

Mr. Lee: In reference to our criterion, I am making an inference that counsel may wish to characterize this regulation as possibly an arbitrary measure, without a reasonable justification for it being there. There may be the legal authority to put it there, but the measure may appear to us to be arbitrary. Is that the direction counsel is following?

Mr. Bernhardt: At this point, it may simply be a point of clarifying. In the first point, if it turns out that there is a reasonable explanation for why the scheme is set up that way, I suppose then it just becomes a case of that term ``taxable farm income''. That is a net taxable income from farm sources. That is a known term under the Income Tax Act. To turn around and say that that is what it says but that we do not read it that way, that perhaps they should amend it, is not what we want to do.

The second issue, there is a potential contravention of the Privacy Act. Again, we have not got the other side. It was suggested that there may be a problem there, but the rationale as to why this was all right, why they did it this way, we have yet to receive. We have been told why they do it this way; however, the legal justification has yet to be presented.

Mr. Lee: Let us make sure that I have it right. Subject to the Privacy Act concern, there is not an issue about the ability of the agency to impose the measure. We are questioning it because we do not see its piece in the rational scheme of things.

Mr. Bernhardt: Right.

Mr. Lee: In other words, the measure must be arbitrary. If they have the legal authority to impose the measure, then that seems to be a slam dunk from the point of the agency. From our view, we are questioning its rationale. Therefore, we must be relying on our criterion of an arbitrary measure; is that correct?

Mr. Bernier: You could certainly put it that way as well as elucidation as to form and purport. You have a regulation that is there to give compensation to people who have to destroy, I believe, tender fruit trees because of this disease. It provides compensation to everybody, except somebody who is a newcomer to the industry. That is the first point.

If somebody did not have income because it is their first year operating a tender fruit farm, the individual cannot get compensation, apparently.

The answer is that it has not happened so far. Should we wait until it does happen, until a newcomer suddenly has to destroy his entire establishment and finds out that he cannot get compensation under a program that is designed to provide it?

The Joint Chairman (Mr. Grewal): The issue here appears to be that the questions the committee have asked have not been addressed. Having the agency address those questions should be a priority. To do that, we should write a strong letter to extract the concerns that need to be addressed.

If we feel that it may not be easy to extract the questions addressed, then we should write to the minister as well; agreed?

Mr. Hanger: Since 50 per cent of the discussion has centred around the information that has come forward from the Canadian Food Inspection Agency — it looks like there is a pile more here to come — has it been appropriate to invite an agency representative to the committee?

The Joint Chairman (Mr. Grewal): In the past, various representatives have appeared before the committee. However, I do not believe there is a plan to invite the agency representatives, at this time.

Mr. Hanger: It would be a good idea to talk to somebody from the Canadian Food Inspection Agency.

Mr. Anders: Hear, hear!

The Joint Chairman (Senator Bryden): We can certainly ask anyone to come before us, but we need to bring them before us to deal with issues that we can do something about, that we can fix. That is why it is important that everyone look at the authority of this committee and its terms of reference to deal with things.

Clearly, we are not in the position to deal with the policy issues as to whether there should be a food inspection agency and the policies that have gone to Parliament in relation to that. We have a restricted mandate; that is, to ensure that the regulatory regimes made under acts of Parliament by agencies, by departmental officials and by Order in Council are properly made under the terms that Parliament has provided, and under the general law that they cannot violate the Constitution, they cannot be totally arbitrary, and so on.

Yes, we can have people come before us, but we need to be sure that we know the questions we want answered. There is no point in putting questions for which we have no jurisdiction, because the witnesses will simply say that they cannot answer such questions.

Mr. Hanger: I understand the committee's position. However, even before this committee have come suggestions from the CFIA that, in their view, may be a dilemma. They request to move off in a certain direction, to have more influence in certain areas. There may be another point of view that the committee could examine. On the subject of seed, it is evident that there is a glitch in the current legislation, as this transition takes place into this private industry regulation. I would like to know why they think they should even have their hand in it, but they are suggesting that they do.

The Joint Chairman (Mr. Grewal): I will answer that, Mr. Hanger. The questions we asked in the past about some of these issues were asked, we wanted answer, we wanted those issues to be addressed, but unfortunately we did not get what we wanted to know. Therefore, it would seem logical that we tell the agency that these are the issues that need to be addressed, this is what we want to know and these are the questions to be answered. If the agency does not answer the questions, then we may look into inviting the representatives of the agency to appear before us.

However, the first logical step would be for this committee to demand the answers from them in writing — because the agency may not know that some of the issues in question have not been addressed. We should write to the agency in strong terms, and send a copy to the minister or write to the minister. If we are dissatisfied with their answers, we will call them before the committee, ask those questions of them and extract the answers from them.

Do members agree that that is the logical way to proceed?

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): Counsel, is that notion clear?

Mr. Bernier: Yes.

The Joint Chairman (Mr. Grewal): Let us move to the next item.


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

Mr. Bernhardt: Amendments have been promised in respect of points noted in parts 1, 2 and 5 of counsel's letter of November 18, 2002. A progress report on these should be requested. Point 3 concerns a printing error in the Canada Gazette. These errors are sometimes corrected by publishing an erratum, but no amendment to the regulations is required so no further action is required on that. That leaves points 4 and 6.

Point 4 deals with provisions that re-enact provisions that had previously been objected to and had been deleted as a result. They have now been stuck back in. That is sections 48(3) and 48(4). These provide that the established grades can be disregarded where the grower and the purchaser agree to this, provided that certain things are set out in the contract and that at least 95 per cent of the tubers are within the range of sizes specified in the agreement. The committee previously concluded that such an approach represented an unlawful attempt to give the force of the legislation to the provisions of a private contract. The agency has advised that it intends to recast these provisions as an exemption, in effect saying that these specified sizes do not apply if they agree and if the potatoes meet the required sizes in the contract, and so on.

First, the act does permit regulations exempting persons and seeds, but there is no authority for making these exemptions conditional as the agency is proposing. Second, this requirement that at least 95 per cent of the tubers actually be within the specified size set out in the contract still represents an attempt to use the regulations to enforce private contracts. For these reasons, the solution proposed by the agency would not appear to be satisfactory.

The same can be said for the amendment to section 61, proposed in point 6 of the correspondence. This provision seeks to regulate shipments of certain kinds of seed potatoes. The act, however, only governs sale, import and export, and not transportation. Amending the section as proposed by the agency would not address this difficulty either.

I would suggest that these two matters need to be pursued and the agency be advised that it needs to rethink its proposed amendments.

Hon. Members: Agreed.

Mr. Anders: I agree that the self-appointed emperors of seed need to have their wings clipped.

Mr. Hanger: Could you tell me why the agency wants to regulate the transportation of potatoes between farms?

Mr. Bernhardt: That is a good question. The Seeds Act does not contemplate them doing that.

Mr. Hanger: Why would they want that?

Mr. Bernhardt: You would have to ask the agency.

Mr. Hanger: That is what I would like to do.

Mr. Lee: Ask them in the letter, Mr. Chairman.

Mr. Hanger: I would like clarification on that, as well as on who will enforce it and what the fines are for violation.

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): That will be mentioned in the letter.

Mr. Bernhardt: We will ask the questions and seek the information.

The Joint Chairman (Mr. Grewal): Let us move on to ``Reply Satisfactory'' items on our agenda.







Mr. Bernier: Mr. Chairman, this correspondence concerns the status of various local port corporation bylaws that were made under the authority of the Canada Ports Corporation Act but not registered under the Statutory Instruments Act. Those bylaws were subject to registration, as the act provided a penalty for their breach. In order to avoid the obligations imposed by the Statutory Instruments Act, local corporations adopted, as part of their bylaws, a provision stating that, notwithstanding the act, breach of the bylaw would not be subject to the statutory penalty provisions. If a breach of a bylaw does not give rise to a penalty, the bylaw was no longer considered to be a regulation within the meaning of the Statutory Instruments Act and did not have to be submitted for examination and registration.

The joint committee was firmly of the view that a provision purporting to set aside the statutory penalty was illegal and that those bylaws were subject to registration. Eventually, in the course of this file, the Canada Ports Corporation Act was replaced by the Canada Marine Act. Under the new act, former bylaws of local port corporations were continued in force to the extent they were consistent with the new statute.

The committee pointed this out to the minister and the minister agreed that the concern regarding the status of those instruments under the SIA remained valid. When the matter was again pursued with the relevant department, the reply disclosed a failure to deal with the relevant issue — and this was pointed out in a letter dated January 29, 2002.

The reply from the department is before the committee today. In order to get out of the situation that it dug itself into, the department decided to deal with the whole situation on the basis that the committee was right after all, in that the non-penalty provision included in the local port corporation bylaws was indeed illegal and ultra vires. This, in turn, allows the department to propose that the bylaws should have been registered under the Statutory Instruments Act. Given that they were not registered, the clause of the Canada Marine Act that continues regulations in force does not apply, because the regulations were never in force in the first place.

To put it in a nutshell, after years of disputing the committee's view that these bylaws were illegally withheld from the application of the Statutory Instruments Act, the government now willingly embraces the very same view as it seeks to extricate itself from the impossible obligation to register the bylaws.

As matters stand, I would suggest that the committee accept the government's hoisting of the white flag on this and close this file.

Hon. Members: Agreed.

The Joint Chairman (Mr. Grewal): How long did it take to do that?

Mr. Bernier: It took 10 years.

The Joint Chairman (Mr. Grewal): Thanks.

The next two categories are ``Action Promised'' and ``Action Taken.''



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


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


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


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


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


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

Mr. Bernier: With regard to the instruments listed under the heading of ``Action Promised,'' I can indicate that they include some 14 corrections promised to the committee. Of particular note is a provision of the Processed Products Regulations, which provides for the detention of private property for non-payment of fees without proper legal authority. That provision and a similar one in another regulation will be revoked, and an undertaking was sought and given that the provisions in question would not be enforced pending their deletion.

As far as the instrument listed under ``Action Taken'' is concerned, it effects three corrections requested by the committee, and I would point out that one instrument listed under the preceding heading also effected one amendment asked for by the committee.

Finally, for Mr. Lee's benefit, there are 99 instruments submitted to the committee without comment.

Mr. Lee: Well done.

The Joint Chairman (Mr. Grewal): Thank you very much.

Members have the 99 instruments for their review.

Mr. Bernier: Again, as an explanation to new members, we formerly included a copy of the actual regulations that were submitted without comment, but it added a mountain of paper to your agenda material. That practice was stopped by the committee. We now bring a copy; hence, if any member sees a title of some particular interest, he or she can look at the actual instrument.

The Joint Chairman (Mr. Grewal): We will see everyone on November 18.

The committee adjourned.

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