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Proceedings of the Standing Joint Committee for the
Scrutiny of Regulations

Issue 5 - Evidence, February 28, 2008

OTTAWA, Thursday, February 28, 2008

The Standing Joint Committee for the Scrutiny of Regulations met this day at 8:35 a.m. for the review of statutory instruments.

Senator J. Trevor Eyton and Mr. Derek Lee (Joint Chairs) in the chair.


The Joint Chair (Mr. Lee): Before we get into the agenda, I wanted to report to colleagues on a housekeeping matter. As part of a broader consolidation of administrative services throughout Parliament, it was the general intention of the Library of Parliament to have the secretariat for this committee relocate from its current premises to new premises being provided by the Library of Parliament. For the recent history of our secretariat, the premises have been provided not by the Library of Parliament but by the Senate. While there is a whole history associated with that, both Senator Eyton, our chief counsel and I have had discussions and negotiations with the Library of Parliament.

I wanted to report to colleagues that that issue is still current and a final decision about a possible move has not been made. Discussions are continuing successfully and cordially, with all interests being taken into account.


(For text of documents, see Appendix A, p. 5A:1)

Peter Bernhardt, General Counsel to the Committee: Mr. Chair, this order increased the levy deducted on pulse crops produced in Saskatchewan and marketed outside the province. Although it was made on August 1, 2003, the order was not registered until October 25, 2004, nearly 15 months later. As a result, it did not come into force until this later date.

After several exchanges of correspondence, it became evident that the provincial board had simply imposed the increased levy under its provincial legislative authority and then proceeded to collect it in respect of all crops, regardless of whether they were marketed inside or outside the province. The consequence, of course, would have been that the increased levies on crops marketed outside the province were illegally collected until such time as an order increasing the levy under the federal legislation had been made and registered.

When this file was last before the committee, it was noted that situations like this are not uncommon; they arise in connection with levies imposed by a variety of provincial agricultural-marketing agencies to which federal powers have been delegated. In view of this, the National Farm Products Council was asked what steps it takes to make the various marketing agencies in the provinces aware of the requirements they must comply with under federal legislation. In its reply, the council describes several initiatives, such as the distribution of guidelines, meetings with provincial commodity boards and other contacts with these organizations.

I should add that witnesses from the National Farm Products Council and the British Columbia Vegetable Marketing Commission are scheduled to appear in connection with a similar situation in that province at the next meeting of the committee. Therefore, members will have an opportunity to seek further details from the council at that time should they wish.

The Joint Chair (Mr. Lee): Are there any comment or questions?

The Joint Chair (Senator Eyton): You said the practice was common. How common is it? Is it something that occurs all the time?

Mr. Bernhardt: It does come up fairly regularly. It is an issue that has been before the committee on at least six occasions. They tell us there are some 80 provincial agencies. Therefore, it is not a problem every time, but we do see it every so often.

The Joint Chair (Senator Eyton): Are there significant dollars involved?

Mr. Bernhardt: There can be, although I do not have the exact amounts in this case. That was one of the series of questions we had asked the British Columbia Vegetable Marketing Commission. When they appear in two weeks, we should have some information on the dollar figures in that case.

The Joint Chair (Senator Eyton): Have complaints been filed?

Mr. Bernhardt: In most cases, the producers know that they have to pay a levy. They send their product through the board and they pay the levy and nobody worries too much.

The Joint Chair (Senator Eyton): Interesting. Thank you.

The Joint Chair (Mr. Lee): I see that, in this instance, the levy is described as a 1 per cent levy, or check-off or tax. While the committee is usually pretty vigilant about seeing to the return, reimbursement or some arrangement for illegally collected taxes or levies, in this case, the levies were collected under provincial legislation. It is not clear that we have a mandate to do anything but make a comment about the possible ultra vires nature of the provincial regulations under which the allegedly illegally collected levies were collected.

In this case, all of those issues can be folded into the basket of questions for the week after next, when officials from the council will be here in front of us. If that is okay with colleagues, we will move to the next item.

Hon. Members: Agreed.


(For text of documents, see Appendix B, p. 5B:1)

Mr. Bernhardt: Three amendments were promised by the Department of Fisheries and Oceans in 2000. The amendments involved two points of drafting and the need to specify the types of terms and conditions the minister may put in licences, as is commonly done in other fisheries regulations.

At the time, the committee was told that these amendments would be made together with other amendments that were anticipated to proceed during the next fiscal year. Since then, there has been a series of delays pending consultations with stakeholders and the submission of a proposal from the provincial government. However, the department always stated that it intended to address the committee's concerns when the regulations were amended.

In 2007, the committee was informed that while its comments would be taken into account, the department did not know whether changes recommended by the committee would be adopted. In addition, the department declined to provide a time frame.

Members did not find this satisfactory. In the committee's December 12 letter, the chair asked for the minister's cooperation in ensuring that the promised amendments would proceed without further delay, independently of whatever other amendments to the regulations might be contemplated.

The committee also gave instructions that the file be brought back before it when Parliament resumed sitting in the new year. To date, no reply from the minister has been received.

The Joint Chair (Mr. Lee): Comments? This particular official — whose name is pronounced the same as mine, coincidentally — seems to have backtracked on the position of the department. Backtracking on written commitments should catch our attention at least. I do not know how to make this file go right again unless we call or report. I am leaning toward asking the official, or an official, to appear.

There also may be a basket of issues the minister may wish to address. We have many issues under these fisheries regulations across the country.

Counsel, would you comment on possible options for us at this time?

Mr. Bernhardt: As the chairman's letter indicated, we were hoping to have something from the minister by now. One option would simply be to follow up with the minister and see when we will get something. The other option would be to suggest that, if a reply cannot be provided in the very near future, perhaps the committee would like someone to appear and provide it in person.

The Joint Chair (Mr. Lee): Mr. Wappel and Senator Harb wish to speak; perhaps we could hear from someone from the government side as well.

Mr. Wappel: Mr. Chair, I kept quiet initially because I always sound like a broken record; my advice is always to bring the people before the committee. I kept quiet until you suggested that — and I agree with you. Two months for a minister to respond to a committee is simply too long.

It is incorrect to send another letter asking why there has been no response. We should ask Mr. Li to be here, as well as the deputy minister. We can invite the minister. If he so chooses, he can attend here; if he does not want to attend before the committee, that is fine — his deputy will be here, as will Mr. Li.

You are right, Mr. Lee; we would like to ask Mr. Li why he has changed his opinion.

The Joint Chair (Mr. Lee): The departmental Mr. Li may not have been fully aware of the previous commitment. There is always a turnover in the department, and this file is nearly 10 years old.

Senator Harb: It strikes me, as you and Mr. Wappel have correctly stated, that this is not the first time we have dealt with issues of this nature. Could counsel assemble a list of all the outstanding issues with that specific department, if he has not already done so. It would be beneficial to list the outstanding issues — because I am sure there are at least four or five different files that have not been addressed.

Mr. Bernhardt: Off the top of my head, I expect we are probably looking at about 50 current files with Fisheries and Oceans.

Senator Harb: I would list all the files, one by one. Frankly, it is pathetic. I have yet to come to a meeting — I have been a very quiet boy over the past little while — without seeing at least one or two files dealing with Fisheries and Oceans — whether the issue is related to licences or fishing, or this or that — and most of the responses seem to skate around the issues without addressing them.

Perhaps Mr. Wappel's suggestion is very timely. We could list all of those issues, with dates, to refresh the memory of the department and that of the minister, and ask them to appear before the committee. Hopefully, this matter can be brought to a head and they can give us a date in terms of when they will take action. If they are going to take action, they will say yes; if they do not want to take action, they will say no. In the case of a yes, give us a date; and in the case of a no, why not?

Senator Moore: You want to look them at the eye and ask them.

Senator Harb: Absolutely.

Ms. Hinton: I am substituting today for Mr. Epp. I apologize for not having any experience on this particular committee, but one of the comments you just made struck a chord with me.

You said this the matter in question has been an issue for 10 years. Have you ever had a minister in front of this committee to address some of these issues?

The Joint Chair (Mr. Lee): Yes. It is not common, but we have had ministers, yes.

Ms. Hinton: Good.

Mr. Szabo: How old are these files?

The Joint Chair (Mr. Lee): We have a few that have probably gone back 20, 30 years. There are just a few in that category, and there are real reasons for why we are unable to close the file; however, 10 years is looking a little long in the tooth.

Ms. Hinton: That is quite a while. Sorry to ask an unnecessary question, I am just trying to get brought up to speed.

The Joint Chair (Mr. Lee): Ten years is reason enough to take notice. Are Senator Harb and Mr. Wappel's comments helpful, counsel?

Mr. Bernhardt: Yes, we will put together something and have an omnibus fisheries meeting.

The Joint Chair (Senator Eyton): Speaking from the government side of the house, although we are all together on this issue, I support entirely what Mr. Wappel said. I think it would be useful to have the checklist that Senator Harb mentioned as a reminder.

It is important, as well, to point out to them that this is exceptional, that the Department of Fisheries and Oceans in general has shown less respect and responsiveness than other departments have.

Senator Moore: Just before we leave this topic, we are going to follow Mr. Wappel's suggestion of requesting the officials to be here, in addition to the list, is that correct?

Mr. Bernhardt: Yes. The list will be part of the request.

The Joint Chair (Senator Eyton): For clarity, Mr. Wappel mentioned that the deputy minister and the minister would be welcome to attend, although we are not asking for that.

Mr. Wappel: We would want the deputy minister to appear but we could not force the minister to be here.

The Joint Chair (Mr. Lee): We have a resolution. Is it agreed?

Hon. Members: Agreed.



(For text of documents, see Appendix C, p. 5C:1)

Mr. Bernhardt: The committee had raised concerns in connection with 50 provisions of these regulations. A number of amendments were promised. More fundamentally, the regulations put in place a regime that is simply not supported by the legislation. In effect, you have a set of regulations at odds with what the parent act contemplates. For example, the regulations attempt to institute a licensing regime for fish processing establishments, when all the act provides for is simply the registering of these establishments.

Numerous provisions impose record-keeping requirements and information-submission requirements, none of which have any clear legislative authority. Bill C-27, which was introduced in a previous Parliament, would have remedied this problem — but, unfortunately, Bill C-27 failed to pass. It was decided not to reintroduce it. In his July 31 letter, the minister indicates that new regulations are being developed under the existing legislation that are intended to respect the committee's concerns while maintaining the integrity of the system. It is difficult to imagine how that will be the case, so perhaps further details should be sought.

In addition, there were a number of specific points in respect of which the first reply from the Canadian Food Inspection Agency, CFIA, was considered unsatisfactory. These had been held in abeyance in the hope that Bill C-27 would pass. When it did not pass, they were followed up in counsel's letter of May 1, 2007. Subsequent correspondence from the CFIA on other files indicates that the agency considers the minister's reply to have addressed these points. Clearly, this is not the case. I suggest a further request for a detailed reply on each of those points should now be made.

The Joint Chair (Mr. Lee): I thought the minister's reply looked pretty good, but there are still some serious housekeeping issues. Thank you, counsel.


(For text of documents, see Appendix D, p. 5D:1)

Mr. Bernhardt: Under the Species at Risk Act, when the Committee on the Status of Endangered Wildlife in Canada, COSEWIC, completes an assessment on the status of a species, it must provide the Minister of the Environment with a copy and its reasons. The Species at Risk Act also says that within nine months after receiving an assessment, the Governor-in-Council, GIC, is to review the assessment. The GIC can add the species to the list of species at risk or decide not to add it to the list or refer the matter back. Where the Governor-in-Council has not taken action within nine months, the minister is required to amend the list in accordance with the assessment.

Although the Species at Risk Act provides for a nine-month period for taking action commencing on receipt by the Governor-in-Council of the assessment, the act does not provide for the receipt of an assessment by the Governor-in- Council but only by the minister. The intent of the act is that action taken on an assessment is to be taken within a fixed period of time, but if the minister has a discretion to determine when or even if an assessment is to be passed along to the Governor-in-Council, the minister can entirely defeat the intent of the act.

The only receipt mentioned in the act is receipt by the minister, so it could be argued that Parliament must have assumed that the nine-month period would start when the minister received the assessment. The failure to provide for the transfer or the forwarding of it on to the Governor-in-Council would then be seen as a flaw in the Species at Risk Act. This leads to the conclusion that receipt by the minister must also constitute receipt by the Governor-in-Council. The significance in the case of this order is that the nine-month period would have elapsed before the order was made. This would mean that the minister was required to add these species to the list of species at risk and that the decision not to do so must be invalid.

The Department of the Environment puts forward a different interpretation. It relies on the bare words of the act. the minister and the Governor-in-Council are obviously two distinct entities and if Parliament had intended the nine- month period to begin when the minister accepted the assessment, then it clearly could have said so. It also suggests that the decision as to when an assessment is to be forwarded from the minister to the Governor-in-Council has intentionally been left to the discretion of the minister because of all the work and consultations that have to take place before a decision can be made. On its face, the wording of the Species at Risk Act supports the interpretation advanced by the department. At the same time, it is hard to conclude that Parliament intended that the goal of the timely decision could be defeated simply by the minister delaying the submission.

It is open to conclude that the failure to provide for receipt of an assessment by the Governor-in-Council reflects a gap in the scheme set out in the act. This may not be a matter falling within the scope of this committee's mandate but members might wish to consider drawing it to the attention of the relevant environment committees of the two Houses.

Ms. Barnes: Recalling that legislation, I know that you are correct in your comments that the intent was that you could not delay it. At the very least, we have to send it on to the environment committees as the appropriate action because doing anything else would be outside the scope of this committee.

The Joint Chair (Mr. Lee): My perspective is similar, but I reach a different conclusion than that of Ms Barnes. The work of this committee is not only in reading and interpreting the regulations but also the statute, because it gives rise to the authority to issue and make the regulation.

In looking at the relevant statute in this case, counsel have found an arguable gap, which they do not believe Parliament intended. The department is relying on the gap to wedge in a departmental role in the timing of giving notice of the committee's decision on a particular species. I can appreciate the desire of the department, and they tell this committee how important it is for them to have that window. However, Parliament conspicuously did not construct any window. Rather, they drafted a section that arguably is faulty and leaves room for this argument. The committee ought to provide some comment on the statute. There is no problem with the regulation or with the report of the committee; the problem is in the statute that authorizes the regulatory response.

The committee that reaches the opinion on the species, having recognized this arguable flaw, should simply give notice to the Governor-in-Council at the same time that they give notice to the minister. Could they not do that? Would that not put the Governor-in-Council in receipt of the assessment? Would that not eliminate the gap and start the clock running as Parliament intended?

Is this committee able to suggest that to the review committee? In that way, the problem would be resolved with the elimination of the gap. Is that viable?

Mr. Bernhardt: I suppose the distinction may come down to the difference between notice in fact and notice in law for the purposes of the act. The act simply says that the committee is to give its assessment to the minister. As far as the wording of the statute is concerned, that is the mandate of the committee — that is, to report to the minister.

If the committee chooses to forward a copy to the Governor-in-Council, then, as a practical matter, the Governor- in-Council would be aware of it. It may be a different matter as to whether that constitutes legal notice or legal receipt of the assessment for purposes of the act.

The Joint Chair (Mr. Lee): The mechanism of providing notice to the GIC is not spoken of in the statute. Why would the minister presume that it is the minister who would give notice to the GIC? Why would they make that presumption?

Mr. Bernhardt: The minister, under the statute, is the person who receives the assessment. The act than speaks of the Governor-in-Council getting the assessment. We have to infer, then, to some degree, how that assessment gets from A to B, because it is not dealt with specifically in the act. We assume that, at some point, the minister must pass it along.

Ms. Barnes: That is an interesting concept. The only problem with it in reality is that it will not fix the problem going forward. The problem will continue to exist. You would have to have forward notice coming on each and every occasion where it was missed.

We would be correcting a situation, but I do not agree that that is our role. I think your interpretation is that it was intended to move forward. However, I do not think it is this committee's role to move it on to the Governor-in- Council. I believe we should be highlighting this as soon as possible. The outcome is needed to get this addressed as quickly as possible, not only for this one, but for every other one that will come forward. Otherwise, we have wasted our time legislating.

Mr. Wappel: I agree with Ms. Barnes. Your suggestion is an interesting one, but the problem is that it would then depend entirely on the makeup of COSEWIC, from time to time, to decide whether it wishes to send notice to the Governor-in-Council. That is the first problem.

Problem two, as identified by counsel, is the following: Does that constitute legal notice under the statute? I am sure the Governor-in-Council would argue ``no.'' The chain of command would be that the minister would bring it to the Governor-in-Council.

You correctly pointed out, as did counsel, that this is a problem with the statute; at least it is an arguable problem with the statute. Ms. Barnes clearly pointed out this is a contentious piece of legislation. Every line and comma of the act was examined and argued over in committee. The committee itself, as pointed out in the note, drafted further sections due to the reticence of the then minister, or due to whatever the history was.

I do not have any problem bringing it to the attention of the current chair of COSEWIC. That is a good idea. However, I think it should still go to the two Houses' respective committees.

Speaking of the mandates of this committee, I am wondering if we cannot offer a legal memorandum to the two Houses as a committee? I have been here a long time, so I am amazed I do not know the answer to this question. This memorandum would point out the possible flaws in the legislation. It would simply be a report to Parliament. It would not be done to take any action but simply to put it on the record in both Houses. We would indicate in that memorandum that we have, in fact, forwarded it to the two respective committees and we have forwarded this opinion to COSEWIC as well.

That, I hope, would then keep it going, even after a possible new Parliament, new chairs, new ministers and new members because it would be on the record of Parliament.

Is that beyond our mandate, counsel?

Mr. Bernhardt: No, it is not. In a sense, the committee interprets its own mandate. Therefore, if members feel that that is an appropriate way to go, there is certainly nothing preventing the committee from reporting its view and its findings.

Mr. Wappel: My suggestion is that we do that, and report to both Houses of Parliament while at the same time sending the matter to COSEWIC and to the two committees. We get it on the record and everyone has notice of it. It will be up to another Parliament to fix it.

The Joint Chair (Mr. Lee): That is a constructive suggestion. Are we agreed?

Ms. Barnes: I am flexible where good suggestions have been tabled.

Mr. Szabo: To the extent that it goes to committees — and I know sometimes committees can become tied up — the urgency of this really should be flagged, as well. It should beg for the prompt attention by those committees of both Houses. Otherwise, our problem will not be fully resolved until they have done their work.

Therefore, we should solicit their prompt attention as well as collaboration on resolving this matter expeditiously.

The Joint Chair (Mr. Lee): Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix E, p. 5E:1)

Mr. Bernhardt: Two points were raised concerning section 4 of the regulations, Mr. Chair. The first concerns the wording of the French version. The National Energy Board has agreed to amend. That has not been done; it would be appropriate to inquire of the NEB as to whether it still intends to do so.

The second point concerns the incorporation by reference as amended from time to time of two standards of the Canadian Standards Association. Counsel had initially expressed the opinion that this involved an illegal sub- delegation of the regulation-making power delegated to the board.

The examination of this file was suspended, however, pending a decision on a possible report on incorporation by reference. That report — Report 80: Incorporation by Reference — was tabled on December 6, 2007. Having looked again at these regulations and based on the principles set out in that report, the better view would appear to be that there is no illegal sub-delegation in this case.

The reasons for this conclusion are set out in the note included in the materials this morning. In brief, it is suggested that a pipeline being designed and built according to referenced specifications can be seen to prescribe a condition under which it is not necessary to obtain leave of the board. Even if the condition includes incorporated specifications that may vary after the passing of the regulations, the fact remains that the board has prescribed the condition.

This is different from a situation, say, where Parliament delegates the power to make regulations prescribing design and construction specifications. In that case, the adoption of regulations incorporating by reference specifications from another body as amended from time to time would clearly constitute an illegal sub-delegation of power.

At the end of the day, although our reasons differ from those of the board, it is suggested that this aspect of section 4 of the regulations is acceptable.

The Joint Chair (Mr. Lee): Are there any comments?

I want to congratulate counsel for their work on this. They have done a very good job. It shows flexibility, rationality and all kinds of great things that the committee manifests.

Mr. Bernhardt: We will follow up the one minor amendment, but the major issue is resolved.


(For text of documents, see Appendix F, p. 5F:1)

Shawn Abel, Counsel to the Committee: Section 4 sets out the form in which information, if required, must be provided to the minister. Section 4 uses peculiar wording by stating that ``it is a prescribed condition'' that the information be provided in the specified form.

Counsel's first letter pointed out that the enabling authority for section 4, which appeared to be section 107.1(1) of the Customs Act, authorizes the prescription of conditions that would limit the minister's power to require information rather than conditions affecting the persons who provide the information.

The March 24, 2006, reply from Canada Border Services Agency, CBSA, asserted that the actual enabling authority is section 164(1) of the act, which allows the Governor-in-Council to make regulations, generally, to carry out the purposes and provisions of the act. In this case, the purpose would be to provide air passenger information in a useful form to the CBSA before passengers arrive in Canada. It is suggested that this would fall within the purposes and provisions of the Customs Act.

The CBSA also promised to amend section 107.1 of the act to clarify which provisions authorize the application of section 4.

Counsel wrote again on April 18, 2006, raising three points, which were answered in a July 7 letter from the CBSA. The first point noted that section 164(1) of the act was not cited in the order preceding these regulations. The CBSA confirmed that, in future, this provision would be cited.

Counsel's second point suggested that section 4 be reformulated to remove the phrase ``it is a prescribed condition,'' and simply state that the person shall provide the required information in the required form.

The CBSA seems to miss the point in their reply to this, indicating that changing the wording is not necessary because it does not change the legal requirements being imposed. While this is true, the point of the suggested change is to eliminate any confusion concerning the enabling authority of section 4.

Counsel's third point suggested that it is not necessary to amend section 107.1 of the act, since the regulations as they are now appear to be fully authorized by the act. CBSA has agreed to this point.

In summary, it is suggested that satisfactory replies were received in regard to the first and third points. Perhaps a further letter should be drafted in respect of the second point.

Mr. Wappel: The second paragraph of the July 7 letter states, in part:

. . . we would like to confirm that we will from now on, if necessary, refer to paragraph 164(1)(j). . .

``From now on'' and ``if necessary'' do not go together. I am not quite sure what the writer means by that. Either it is necessary or it is not. Perhaps counsel could answer that.

I read this three or four times and I am still agreeing with Ms. Zamparo in the same letter, when she says:

As regards your second point, we do not quite understand your argument.

I am having real difficulty understanding the argument on section 4. As I read it, ``it is a prescribed condition that the member provide'' and ``the member shall provide'' is saying the same thing. It may not be elegant, to use Mr. Rousseau's words, but nonetheless, the way I read it, it is the same thing.

Perhaps counsel could explain further, first, what the words ``if necessary,'' mean and, second, why we need clarification on the second point?

Mr. Bernhardt: I will address the first point and then Mr. Abel can go through the second.

I do not know if it is being generous or cynical, but, when I read that, I simply took it as the bureaucratic reflexive inability to say anything in a straightforward manner without qualification. I read it to mean that, if we are relying on that provision in the future, we will recite it. You are quite right, one simply could have said: Yes, we will do it. Perhaps I have read too many of these.

Mr. Abel: That was my view of it as well. At the end of that sentence, they talk about referring to it if necessary ``in any order accompanying an amending regulation.'' Clearly, they could be amending other parts of these regulations where it would not be appropriate to rely on enabling authorities.

Mr. Wappel: What about the second point?

Mr. Abel: You are perfectly right that it is fine; but I would follow Mr. Rousseau by saying it is inelegant in this case. Using the phrasing ``it is a prescribed condition'' naturally leads one to look to the wrong enabling authority, one that speaks about prescribing conditions. In this case, they are instead relying on a general enabling authority. We thought the wording would provide more clarity. If we were to write again, that is more or less the wording we would expect to use.

The Joint Chair (Mr. Lee): I was unhappy with the way this particular file evolved, and I have one question. Counsel seems to have very quickly accepted that the department here is able to rely on the basket clause authorizing this regulation. Something in my gut tells me that is not always correct.

If the department can rely on the basket clause, why does it bother with all of the other enabling provisions? Why did Parliament bother with all of the other enabling provisions in the original statute? Why did not the department cite a mega-citation of the basket clause when it enacted these regulations as the enabling provision?

I see a problem, which is fed by the fact that the department chose to use wording in the regulation that emulated another enabling authority in the statute. Now they are saying we do not need that enabling authority, we will rely on the basket clause — which they never cited in the first place. However, they are still left with the cumbersome wording that emulates the other enabling authority, in relation to which the regulation probably is not compliant.

They are left with this cumbersome wording saying that something that they call a condition is clearly not a condition. It is worded as a condition. They throw in the wording ``it is a condition that.'' That wording, colleagues, could be used in any regulation. It is a condition that you give your name and address.

I am asking rhetorically: What is it a condition of? The wording is superfluous at a minimum. It should not be there and is incorrect, but we have got into this box now.

My question is this: Can the department rely on the basket clause now when it never did before and when there appears to be an enabling provision that specifically authorizes the regulation and in relation to which the regulation does not comply?

Mr. Bernhardt: As to the reliance on the so-called basket clause, it is important to remember, when all the language is stripped away, that what we are dealing with here is the form for submitting information. When the minister requires you to submit the information, section 4(1) tells you the form you will put it in. In that sense, given we are not dealing with the substantive requirement of when you have to provide information or what information you have to provide, but simply the manner in which you provide it, I think the basket clause there is sufficient.

On the other hand, the way this is drafted, you are quite right; in a sense, the department got lucky. They either were not sure what they were doing or were trying to do something else. When a problem was pointed out here, they probably hunted around and found another one; they went fishing and they were lucky. They caught a big one. To mix a metaphor, they caught a fish and now they are off the hook.

The Joint Chair (Mr. Lee): Only because of the basket clause.

Mr. Bernhardt: Yes.

Ms. Hinton: The net.

The Joint Chair (Mr. Lee): Thank you for that. Are there any other comments?

Mr. Wappel: What do we do?

Mr. Bernhardt: The suggestion was that we write back and try again at least to get them to clean up the language. We should point that we are not asking them for a substantive change to the regulation but rather that we are looking for something that reads more clearly, so people can understand exactly the nature of the provision.

The Joint Chair (Mr. Lee): Thank you. Are we agreed on that?

Hon. Members: Agreed.


(For text of documents, see Appendix G, p. 5G:1)

Mr. Abel: These regulations govern the issuance of notices of compliance, NOCs, for drugs to be marketed and sold in Canada. The regulations establish a patent registry maintained by the Minister of Health on which are listed patents related to drugs issued in an NOC.

Following the committee's consideration of this file on June 4, 2007, a further letter concerning three points was sent to Industry Canada, and a reply was received on October 5, 2007.

The first point relates to subsection 3(2), under which the minister is granted a discretionary power to refuse to add a patent to, or delete a patent from, the registry, notwithstanding that it does not meet the criteria set out in the regulations.

As explained in detail in a note accompanying the file today, the department's reply seems concerned with justifying the power of the minister to edit the registry, both by keeping ineligible patents off or by removing them from the registry. The committee has not questioned that the minister should have such a power.

The department seems unable to distinguish between the objective determination of whether a patent meets the registry criteria and the discretionary decision to refuse to add a patent to or delete a patent from the registry. A plain reading of subsection 3(2) clearly indicates two distinct elements to this provision. As the cases cited by the department show, the discretionary grant in this provision seems to have no purpose other than to shield the minister from judicial review. Therefore, the provision should be amended to replace the word ``may'' with ``shall.'' Doing so would not impair the minister's power to edit patents from the registry if they do not belong there.

The second point concerns the French version of paragraph 6(7), in (a) the use of the word ``ordonner'' when dealing with persons, and in (b) ``enjoindre'' when dealing with the minister. In its latest reply, the department provides contradictory arguments. First, the department suggests that the court does not order a minister in this context but requests the minister's help in providing information, while at the same time acknowledging that the minister requires ``the aegis of a court order in order to protect the Minister from allegations of a beach of confidentiality.'' The department insists there is no danger of these two words being interpreted differently because they have the same meaning. Obviously, the department cannot have it both ways — either these words have the same meaning or they do not have the same meaning. It seems inescapable that the French version should use one word consistently just as the English version uses one word consistently, which reflects the fact that what should be issued by the court is a mandatory order subject to the contempt power of the court.

Inconsistent usage suggests that it is inappropriate to order a minister in the same manner that an ordinary person may be so ordered. The committee might recall that this was the first explanation provided by the department in its previous reply. It was suggested that this idea is unacceptable because it offends the principle of the rule of law, which requires that all people — ministers and mere citizens — are equally subject to the law.

The third and final point deals with section 7 of the amending regulations, which provides that certain submissions made to the minister prior to the coming into force of these amendments are deemed to have been made on the date of coming into force of these amendments. When the committee last considered this file, it determined that the deeming provision has a retroactive effect that is not expressly authorized by the Patent Act. The department disagrees, arguing that the deeming provision is prospective rather than retroactive. However, as explained in detail in the note accompanying the file today, the deeming provision should be considered retroactive because it effectively deletes rights and obligations that had existed before the making of these amendments.

Ironically, the department goes on in their reply to describe an alternative deeming provision that had not been used because it had been considered more laborious. It would have applied the newly amended provisions to the prior submissions only from the coming into force date and onwards. Such an approach would not have had a retroactive effect.

In summary, it is suggested that the department has not provided satisfactory replies on these three points. If the committee agrees, a further letter could be drafted.

The Joint Chair (Mr. Lee): This is difficult.

Mr. Wappel: Mr. Norlock will remember that when he and I were on the subcommittee studying the Anti-terrorism Act I suggested numerous amendments, which were agreed to by the subcommittee, to change the word ``may'' to ``shall'' in certain sections. My observation is that that change is often made because, in the legislative drafting division, there is undue deference to judges and ministers. They have no difficulty with using the word ``shall'' for ordinary people and the word ``may'' for judges or ministers, even if no other avenue can be taken other than ``shall.'' I asked the question specifically of the legislative drafters when I met with them on this issue during our study of the Anti- terrorism Act. More or less, they told me that it is effectively a deferential drafting technique, even though ``shall'' is the only logical conclusion.

This committee should push to change the word ``may'' to ``shall'' and eliminate the deference shown to judges and ministers over ordinary people because they are all Canadians. If we push those two points, then we should go with the retroactivity because the general consensus of this committee is that, unless it is extremely clear, we do not do retroactive legislation.

The Joint Chair (Mr. Lee): Thank you, Mr. Wappel, for the helpful comments.

Counsel, in respect of point three, I have not looked at the components of a submission. Does the alleged retroactivity relieve the submitter of a burden or impose obligations? If we are talking only about removing obligations, then I would say it is almost a moot point. If it makes it easier for the submitters, after the new regulations come in, let them have the benefit of that retroactively. However, if it imposes new obligations on those making submissions, then we ought to insist that we cannot impose a burden on someone retroactively, which is consistent with Mr. Wappel's remarks. Have we taken note of whether the retroactivity relieved a burden or imposed an obligation?

Mr. Abel: This is covered briefly at the top of page 7 of the note. Before the deeming provision, a submission that had been filed but not fully processed in the department created obligations to respond to that submission by other drug manufacturers. That main obligation would have been eliminated. The deeming provision would have removed an obligation. In many cases, the obligation would have been fulfilled already and then retroactively removed.

The other consequence we can consider relates to delinquent files — those not processed for not meeting these obligations. At a certain point, the obligations would have simply disappeared. To use your phrasing, it would not have created new obligations but would have removed them, basically.

The Joint Chair (Mr. Lee): Therefore, in theory, I would not be concerned about the retroactivity because we are dealing with a point of principle. We might want to take it into consideration as we manage the issues outlined by Mr. Wappel. Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix H, p. 5H:1)

Mr. Abel: Actions were promised on the 18 points raised by counsel in respect of this instrument, with the exception of point 14 and the first paragraph of point 17, to which it is suggested satisfactory replies were received. If the committee agrees, counsel will continue to monitor the file.

The Joint Chair (Mr. Lee): Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix I, p. 5I:1)

Mr. Abel: Following the committee's consideration of this file on May 31, 2007, counsel wrote to the Department of Indian Affairs and Northern Development concerning three points. The department's reply was received on August 7, 2007. The first point relates to a discrepancy with the Regulatory Impact Analysis Statement, RIAS, accompanying the regulations, which states that a First Nations council will choose their electoral officers from an established pool of qualified officers. The regulations do not impose any such requirement. In its earlier reply January 12, 2007, the department suggested that if a council did not appoint officers from the established pool, the Band Council Resolution identifying those officers would still be subject to acceptance by the department.

The more recent reply clarifies that this is not the case. Instead, the department accepts that there is no requirement that a council selects officers from the established pool. The department argues that the RIAS means that there is an established practice in the administration of First Nations elections that will generally be followed. At best, this seems to be a revisionist interpretation of the RIAS. Apparently, the department has accepted the committee's interpretation of the regulations on this point.

On the second point, the department promises to delete the definition of ``eligible voter'' found in section 1 because it duplicates a definition found in the parent act.

On the third point, when the committee last considered this, it decided that the term ``properly seal'' used in section 15 in respect of the ballot box is ambiguous. The latest reply disagrees on the basis that the department will suggest to electoral officers what procedure to follow when sealing a ballot box. Where an ambiguity exists with respect to a term of substance in legislation, clearly it is not sufficient for an administrative authority to provide the preferred interpretation in order to resolve that ambiguity. The law must speak for itself.

As was discussed above, it is additionally apparent that not every electoral officer may be drawn from the pool trained by the department. In this case, it is difficult to see how the only reasonable interpretation of the term ``properly seal'' could be, and I quote, ``seal. . .involving a lock and/or tape, done in the presence of at least one witness prior to receiving marked ballots.''

Therefore, it is suggested that another letter addressing this point be sent to the department.

The Joint Chair (Mr. Lee): Are members agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix J, p. 5J:1)

Mr. Bernhardt: After considerable prodding, a reply dealing with each of the concerns raised was finally provided by the department. Amendments to the act and new regulations have been promised following the completion of a review of the act that is to take place this year.

Several matters were pursued further in counsel's December 17 letter. In its reply, the department provides the confirmation sought in connection with items 2 and 3, and action has been promised on item 6.

As concerns item 7, the department still seems to be missing the point. Section 38(1)(e) of the Preclearance Act authorizes regulations providing for the manner of disposing of detained, seized or forfeited goods. The only other reference in the act to forfeiture is found section 28. It states that ``. . .goods lawfully seized by a preclearance officer under this Act are subject to forfeiture procedures under preclearance laws.'' Therefore, the disposal of goods forfeited has already been provided for in the act itself. Section 27, which is the only other section of the act to refer to seizure, again similarly states that goods seized ``are subject to forfeiture under preclearance laws.''

This being the case, why does section 38(1)(e) refer to regulations dealing with the manner of disposing of seized or forfeited goods given the act already deals with these things? The department's reply refers to the need for regulations in relation to detained or abandoned goods. However, this was not the question asked.

I would suggest a further letter on this point be sent to the department.

The Joint Chair (Mr. Lee): Are colleagues in agreement? It seems reasonable.

Hon. Members: Agreed.


(For text of documents, see Appendix K, p. 5K:1)

Mr. Bernhardt: Aside from the questions of validity of liquor licence fees that are currently under consideration by the Supreme Court, the only remaining issue in connection with the Parks Canada fees concerned the failure to publish them in the Canada Gazette within 30 days as required by the Parks Canada Agency Act. By the way, I understand a Supreme Court of Canada decision on the former is coming out tomorrow.

The agency advised that this was due to the length of the document, the need to convert it to the format used by the Canada Gazette and the need to reconfirm the accuracy of the document afterwards.

The committee was left with the impression that these same considerations would arise every time there was a new list. It therefore asked what measures had been put in place to ensure that the publication timeline would be complied with in the future. The agency indicates that it has a new database to allow easier access in the updating of information, that it can now generate documents that can be put into the proper format for publication in the Canada Gazette directly and that it is confident this will allow them to adhere to the requirements of the Parks Canada Agency Act.

I suppose time will tell. In fact, a new master list was published in the Canada Gazette a couple of weeks ago. We will be requesting evidence of the date on which the minister approved these fees, to verify whether the time period was complied with.

The Joint Chair (Mr. Lee): This is sort of like getting kids to school on time, is it not?

Are colleagues okay with that? Counsel, do we have anything hanging out there on the Supreme Court decision? The earlier court decisions did not do the law the way the committee did.

Mr. Bernhardt: That is correct. To remind members, the committee has taken the view that those fees, which are based on a percentage of alcohol purchased for sale under the licence, constitute a tax on business. At trial and in the Federal Court of Appeal, the court took the view that, in fact, those fees were valid, were authorized. That then went to the Supreme Court. Judgment was reserved in the Supreme Court. Apparently, the decision will be released tomorrow morning.

The Joint Chair (Mr. Lee): If the Supreme Court allows the appeal, we have been on good ground. If the Supreme Court does not allow the appeal, we have to recalibrate how we think about the propensity of the bureaucrats to levy percentage rents, taxes, check-off, et cetera.

Mr. Bernhardt: Certainly from the committee's perspective, it is a very significant decision.

The Joint Chair (Mr. Lee): It is significant for the citizen, the taxpayer, also.

Mr. Wappel: On that point, perhaps at the next meeting we could have a short brief on the Supreme Court's decision. If it turns out we were right, perhaps the committee should issue a press release, or something of the sort.

The Joint Chair (Mr. Lee): I suspect we were right, but the courts may have judicially changed the foundations of the law. That is what may be going on here. That is a good suggestion, Mr. Wappel. If counsel could do that for us, we would appreciate it.


(For text of documents, see Appendix L, p. 5L:1)

Mr. Abel: In relation to this order, counsel pointed out that there is nothing in the French version of section 4 that rendered the words ``for greater certainty'' as used in the English version. We suggested that the words be removed from the English version. Indian and Northern Affairs Canada sees no difference between the two versions and has not agreed to amend the order. However, it has agreed to take the suggestion into account in future orders. Generally, if a phrase should be omitted from future orders, it follows it should be removed from this order. However, given that this is a relatively minor issue and that the order itself lapses on August 31, 2009, perhaps the committee may find it acceptable. In this case, the file could be closed.

It is worth noting that more recent orders have indeed omitted the wording from the English version.

The Joint Chair (Mr. Lee): On the assumption that the order lapses next year, in August 2009, I feel that is a good conclusion. We have cleared up the problem and the department appears to have recognized it.

Thank you, counsel.


(For text of documents, see Appendix M, p. 5M:1)

Mr. Abel: Following the committee's consideration of this file on May 17, 2007, counsel wrote to the Canadian Environmental Assessment Agency seeking further advice concerning the process by which lands are listed in Schedule 2 to the Canada National Parks Act. Specifically, it asked whether there is typically a significant amount of time between the date that a park establishment agreement is made and the date that a park is listed in the schedule.

The agency explains that a number of steps must occur after making the agreement but before the order adding the park to the schedule can be made. This process can range from 2 to 10 or more years. However, the process as described in Parks Canada's 2003-04 Annual Report seems to indicate that the steps identified in the agency's reply would occur during the negotiation of the parks status agreement.

If the committee feels the more recent reply so be taken as the correct account, it could be considered satisfactory and the file closed. If not, a further letter could be drafted seeking clarification from the agency.

The Joint Chair (Mr. Lee): Are there any comments? Are we happy with the more recent departmental iteration of this?

We are not asking for an amendment. If they have found religion, we will accept it. Thank you.

Senator Moore: So we will close the file?

The Joint Chair (Mr. Lee): Just close the file?

Mr. Bernhardt: Yes, there is nothing left to be done.


(For text of documents, see Appendix N, p. 5N:1)


(For text of documents, see Appendix O, p. 5O:1)

Mr. Bernhardt: Mr. Chair, if members concur, I will follow the usual practice; I will deal with the next three headings as three groups: Action promised, action taken, and statutory instruments without comment. There are two files listed under ``action promised'' in connection with which six amendments are promised. Progress on these will be followed up in the usual fashion.


(For text of documents, see Appendix P, p. 5P:1)


(For text of documents, see Appendix Q, p. 5Q:1)


(For text of documents, see Appendix R, p. 5R:1)

Under the heading ``action taken'' are three instruments that make another six corrections that were promised to the committee. Those matters are now resolved.




















SOR/2007-151 — ``MV SONIA'' REMISSION ORDER, 2007






Finally, under the heading ``statutory instruments without comment,'' there are 25 instruments listed that have been reviewed and found to comply with all the committee's criteria.

The Joint Chair (Mr. Lee): Thank you, counsel. Does that complete our agenda?

The Joint Chair (Senator Eyton): Yes, as far as I am concerned.

The Joint Chair (Mr. Lee): Any other comments? Seeing none, we can adjourn to the next meeting, at which we will apparently have some witnesses from the Farm Products Council.

The committee adjourned.

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