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Proceedings of the Standing Joint Committee for the 
Scrutiny of Regulations

Issue 2 - Evidence - April 21, 2016

OTTAWA, Thursday, April 21, 2016

The Standing Joint Committee for the Scrutiny of Regulations met this day at 8:30 a.m. for the review of statutory instruments.

Senator Pana Merchant and Mr. Harold Albrecht (Joint Chairs) in the chair.


The Joint Chair (Mr. Albrecht): Prior to getting into the agenda distributed earlier in the week, you have papers in front of you that were distributed this morning relating to the possible trip to Australia and New Zealand for a legislative conference. I will let our clerk explain the rationale behind it.

Adam Thompson, Joint Clerk of the Committee: Thank you Mr. Chair.

You will recall at last week's meeting interest was expressed in attending the Australia-New Zealand regulations conference this July. Approximately six members of the committee expressed interest, and on that basis a budget was prepared for six members to participate.

Subsequent to that meeting, in preparation of the budget, I received one other expression of interest. There is an issue as far as the participation of membership. Given that it is a joint committee, the numbers need to be proportionate to the membership of the committee. Therefore, with three members of Parliament to every senator, three MPs to one senator will participate in the trip.

That explains why you have the alternate costing for four participants and eight participants, which is easier to divide proportionally between the two chambers. Those are the two budgets before you.

The Joint Chair (Mr. Albrecht): The two possible scenarios are open to a motion or further discussion.

Mr. Genuis: I appreciate that my good sub at the last meeting had not wanted me to miss the opportunity, but I have to say that in reviewing this, I do not think this is a responsible use of taxpayers' dollars at all. This is an expensive trip. I looked at the conference and it seems basically like a regional conference — the Australia-New Zealand Scrutiny of Legislation Conference. If there were a conference in North America for Canada and the U.S, it could be something to consider. This is a case of travelling halfway around the world to attend a conference.

To be frank, the function of scrutinizing regulations is fairly formulaic and clear. I'm not interested in participating and I don't think the committee should either.

Mr. Brassard: I was one who expressed an interest in going; however, seeing the cost, in my view, makes it prohibitive. There may be some value in the conference, but the value is not to the taxpayers of Canada at this expense. I didn't realize we were going to be renting the space shuttle to go down there at this cost.

Mr. Chair, I respectfully withdraw my name from attending. I will not be going at this expense.


Mr. Dusseault: Indeed, that is quite a lot of money. I would like to know if many Commonwealth countries attend this conference or if it will just be New Zealand and Australia, as Mr. Genuis seemed to indicate.

The Joint Clerk (Mr. Thompson): I will ask Mr. Bernhardt to answer since he accompanied committee members that last time they attended the conference, which was in 2009.


Peter Bernhardt, General Counsel to the Committee: They are primarily focused on Australia and New Zealand. They hold conferences every couple of years down there and usually extend an invitation to various other members of the Commonwealth, largely on the basis that they also have Westminster-style Parliaments and similar systems of government. Australia traditionally has been a leader amongst Commonwealth countries in this area. They take scrutiny seriously.

That being said, there have been at least eight or ten conferences over the years, and I think the committee has attended perhaps two. It's not something the committee attends systemically or regularly as it is only on occasion that the committee has attended. The last time was in 2009.

Last week we circulated the report tabled by the committee following that 2009 conference so members could get some idea of the things discussed and the value that the committee could see at that point.

It's always for the committee to decide how it wants to proceed. Certainly it's not something the committee has done regularly. As I say, the last time was seven years ago.


Mr. Dusseault: Did other countries attend the last conference, or was Canada the only one?


Mr. Bernhardt: When I was there in 2009, I believe that only three countries were represented: Canada, Australia and New Zealand. In Australia they have scrutiny committees at the state level as well. There would have been representatives from each of the Australian states, the capital territory, as well as the Commonwealth Government of Australia, and then of course Canada and New Zealand.

Mr. Anandasangaree: I concur with my colleagues. I, too, put my name forward last week, and I respectfully withdraw.

The Joint Chair (Mr. Albrecht): There's a consensus emerging. I do not wish to extend this debate unnecessarily. I think we'll just leave it as it is. I don't think we need a motion as we are not going to proceed with anything.

Thank you, committee members, for giving that matter your due diligence.




(For text of documents, see Appendix A, p. 2A:1.)

The Joint Chair (Mr. Albrecht): We will move now to Item No. 1 on our agenda, under the heading "Letters To and From Ministers."

Mr. Bernhardt: Mr. Chair, these regulations were made pursuant to the Food and Drugs Act based on the conclusion that human semen processed for assisted conception is a drug within the meaning of the Food and Drugs Act. That view is based on the idea as described by Health Canada that human semen for assisted conception is a substance that alters the organic functioning of a woman and, therefore, meets the definition of a drug.

The committee has taken a somewhat different view of the matter and has concluded there is no authority for these regulations and that they should be remade under the Assisted Human Reproduction Act.

The Minister of Health, while maintaining that the regulations were valid, confirmed that a review was under way in 2006 as a part of a long-term project and that consideration would be given to remaking the regulations under the Assisted Human Reproduction Act, which I think would clearly be the appropriate vehicle for this type of regulation.

Matters were delayed by a legal challenge. Back in 2010, the Supreme Court declared large portions of the act unconstitutional. Parliament then had to amend the act, and the department at that point committed to ensuring that the regulations would be re-enacted once new sections 4.2 and 10 of the Assisted Human Reproduction Act came into force.

Section 10 would prohibit the distribution, use, and importation of ova and sperm for the purposes of reproduction unless those activities are carried out in compliance with regulatory requirements. Section 4.2 specifies that the Food and Drugs Act does not apply to sperm and ova intended for assisted reproduction. However, these two provisions have yet to be brought into force.

In 2014, the department stated that a review of the existing regulations was planned but that this would not commence until 2016-17. This caused the committee some concern at the time because, of course, this would postpone bringing those sections of the Assisted Human Reproduction Act into force and remaking the regulations pending a broad review that was not even due to start for several years.

Because of those concerns, the committee decided to write to the Minister of Health in January 2015 suggesting that sections 10 and 4.2 be brought into force in the interim and that the regulations under the Food and Drugs Act be revoked and remade under those new sections; and that after that, any further amendments that were required as a result of this long-term review could be added to the regulations.

When the committee last considered this file on May 14, 2015, a reply from the minister had not yet been received. Pending the receipt of a reply, the committee instructed counsel to meet with departmental officials to discuss the issue. We were advised by the officials, however, that because of the restrictions on activities imposed during an election period, that meeting would not be appropriate. Over the summer, we therefore told the department that matters would have to await the new Parliament, and at that the committee would consider any reply to the January letter it had received in the interim.

A reply was provided, which is the department's January 4 letter. It advises the committee that preliminary policy work indicates that updates to the semen regulations are required to reflect current science, and that stakeholders are pressing for regulations around the safety of ova for assisted conception as well. For this reason, the department says that it prefers not to reenact the regulations at present under the new act but rather to wait until it has done a broad policy review to decide what updates are necessary and then proceed with it all in one piece.

The department proposes to provide the committee with a progress report on an annual basis, with the first report being made in the fall. I'd suggest as a starting point that before agreeing to this, the committee might want to know how long this policy work and review are expected to take so at least there is some time frame for all of it.

The Joint Chair (Mr. Albrecht): Is there any response?

Mr. Genuis: I have been encouraged by my colleagues to keep it clean on this.

On the broad policy review issue, one consideration I have is that I don't want us to be pushing them to rush a broad policy review. I don't want us to be pushing for a timeline in a way that would have the effect of expediting that. I mean a broad policy review should take the time that's required.

Rather than push them on a timeline for the review, I would come back with the suggestion that they take the necessary time on the broader review and fix the specific regulatory issue that's in front of us. That would be my inclination on this one.

Mr. Badawey: I would recommend that we respond as recommended by Peter and ask for a timeline, not to push them for one, but just to have an idea of it.

The Joint Chair (Mr. Albrecht): Would you care to include as well the expected date for the progress report in the fall of 2016?

Mr. Badawey: Fair enough.

The Joint Chair (Mr. Albrecht): That's the expected date for the update on the progress report and a projected timeline for the actual completion of the policy work. That's the intent of the motion.

Are there any further comments on the motion?

Mr. Genuis: Maybe we can specifically underline in the correspondence that we want them to take the necessary time on the policy review. I don't know if this is in the spirit of the motion but we could also emphasize that we prefer them to fix the regulations specifically. If they could give us some broad contours of how long they expect this to take, I would have no objection to that.

The Joint Chair (Mr. Albrecht): I'm not sure we're looking for broad concept but a pretty definitive time in terms of policy expectation. We're not rushing them, but we want to know what their thinking is and a date as to when this committee can expect their progress report in the fall. Let's say October 15, or whatever; make a date.

Are all in favour of that motion?

Hon. Members: Agreed.



(For text of documents, see Appendix B, p. 2B:1)

The Joint Chair (Mr. Albrecht): Item 2 falls under the heading "New Instruments."

Mr. Bernhardt: Both of these instruments indicated they were made by other than statutory authority. At the same time, the first proclamation states that it was made pursuant to subsection 57(1) to (2) of the Canada Elections Act. The second proclamation stated that it was made pursuant to section 38 of the Constitution Act, 1867. We had two contradictory statements.

In the past, proclamations directing the issue of election writs and summoning the House of Commons have not referred to the Canada Elections Act and the Constitution Act, 1867. Obviously, if it is now considered that these provisions provide authority for these proclamations, you can't say they were made other than by statutory authority.

The powers to dissolve and summon Parliament are considered to fall within the personal prerogatives of the Governor General. Acting in the Queen's name, these powers are not conferred by an act of Parliament but are based on convention. Presumably it was on this basis that in the past they were stated to be made other than by statutory authority.

That being said, it's also true that there are statutory provisions that in some sense limit these prerogatives by directing the manner in which they are to be exercised. For example, section 38 of the Constitution Act, 1867 requires that when summoning the House of Commons, the Governor General must do so by instrument under the Great Seal of Canada. That doesn't restrict the Governor General's discretion but dictates the instrument by which the Governor General is to exercise that discretion. In that sense, it could be said that those proclamations are issued pursuant to the Constitution Act, 1867.

It's a similar situation with regard to the ordering of a general election. Once the prerogative power of dissolution has been exercised, the Canada Elections Act sets out how the Governor-in-Council is to issue the proclamation and what the proclamation is to contain. In a sense you could say it was issued pursuant to the Canada Elections Act.

The points we had in raising this were, first, the contradictory statements; and, second, that it was different from the practice that had been followed over the last 100 years.

The Assistant Clerk of the Privy Council indicated that it was only through inadvertence that these two instruments were stated to be made other than by statutory authority. From the Privy Council's perspective, this was rectified by issuing an erratum in the Canada Gazette and by citing the proper enabling authority in the Index of the Statutory Instruments. If members are satisfied with that, no further action is required.

Mr. Kmiec: I say leave it alone as they've published errata.

This is the First Session of the Forty-second Parliament. We've been having elections for a long time. You would think that they would have a standard form somewhere to use for these types of election calls. My experience in a past life, I used to work for the Minister of Finance for the Province of Alberta. We had a folder that had been passed down for at least 25 years from one minister to the next with the budget documents and the how-to of budget lockups and everything else. This was a tradition from one minister to the next. We've been doing this for a long time.

I'm also reminded that one of the first spending instruments passed in the house was when the President of Treasury Board stood to tell us that the schedules were in the proper form. They turned out not to be as the schedules had been missing. This has happened before with the clerks. This is more of a general concern about standardization.

This institution runs on tradition. I'm just glad that the rule of law won out in the end, and everyone agrees that this election was called under the correct instrument.

The Joint Chair (Mr. Albrecht): Mr. Kmiec, are you offering to write the standardization guidelines for the process?

Are there further comments?

Unless we hear a call to take further action on this, we will leave it as it is. No further action.

Hon. Members: Agreed.


(For text of documents, see Appendix C, p. 2C:1.)

The Joint Chair (Mr. Albrecht): Next is Item 3, a new instrument as well.

Shawn Abel, Counsel to the Committee: This instrument makes nine amendments that address matters raised by the committee in respect of the Health of Animals Regulations and the Seeds Regulations. It was also noted that this instrument purports to repeal the English version of several subparagraphs of the Fertilizer Regulations, despite that these provisions were revoked many years ago.

The Canadian Food Inspection Agency agrees that this was an error. According to the agency, this stemmed from incorrect information in the consolidated version of the regulations, which are maintained online by the Department of Justice.

All I can tell members is that, at present, the online consolidated regulations are correct and up to date. In any case, no issue arises from this attempt to revoke provisions that no longer exist, as that portion of the instrument is simply of no effect. If members are satisfied with that, the file could be closed.

Senator Runciman: I move that we close the file and compliment counsel on getting the CFIA to respond within six months. Well done.

Hon. Members: Agreed.

The Joint Chair (Mr. Albrecht): Interesting. Good work, and thank you.



(For text of documents, see Appendix D, p. 2D:1.)

The Joint Chair (Mr. Albrecht): Next is Item No. 4 under "Reply Unsatisfactory."

Mr. Abel: For ease of reference on this file, I will refer to the Export Allocations Regulations and the Export Permits Regulations.

Four issues were identified in connection with the Export Allocations Regulations. The purpose or necessity of a provision was unclear; the authority for two provisions was questioned; and it was suggested that one other provision could be seen to infringe the right against self-incrimination. The first matter of an unclear purpose was also raised in respect of the Export Permits Regulations.

When this file was before members in September 2014, it had seemed that the department was in agreement to make amendments addressing the committee's concerns as part of an update to the regulations. This would follow from the anticipated extension of the 2006 Softwood Lumber Agreement with the United States. However, that agreement instead expired.

The department now indicates that amendments are on hold. At present no new allocations are issued under the Export Allocations Regulations, and allocations are not currently necessary to export softwood lumber.

While members may find this an acceptable reason not to follow through with the promised amendments to the Export Allocations Regulations, the department should perhaps be asked to confirm that these matters will be addressed if a new agreement is reached and the regulations are amended or replaced.

Despite that the Softwood Lumber Agreement has lapsed, permits are still required under the Export Permits Regulations in order to export softwood lumber. With respect to the one issue raised in connection with the Export Permits Regulations, the department had previously stated it may be appropriate to recommend an amendment. However, the department is now of the view that no amendment is required. Subsection 2(1) of the Export Permits Regulations requires exporters to submit a statement that the information contained in their permit application is true, correct and complete. Section 17 of the enabling act already prohibits the wilful furnishing of false or misleading information or knowingly making any misrepresentation in any application.

The department previously suggested that the statement required by subsection 2(1) of the regulations helped to remind exporters of their obligations and avoid errors that might be attributable to inadvertence, miscommunication or limited understanding of the act. This would be without having to resort to inspection powers or prosecution under the act.

The committee was not persuaded by this argument. That the requirement might serve a practical purpose did nothing to avoid the fact that it has no legal effect. Moreover, the committee noted that the statement could be submitted on behalf of the exporter by an agent, a mandatary or a broker, making it quite unlikely that it would achieve the effect of causing the exporter to verify and attest to the accuracy of the information as the department desires.

The committee's considerations led the department to reply that it may be appropriate to amend this provision in order to clarify it. However, the department's November 13, 2015, letter again contends that the provision is appropriate in assisting applicants to do their due diligence, and, therefore, there's value in retaining it.

The purposes of legislation are to establish and communicate legal rules. There is a presumption against unnecessary repetition in legislation. Words and provisions are to be seen to provide something that is not already set out elsewhere and not to be included merely for emphasis or as a reminder. In applying the principles of statutory interpretation, a court would seek to give some effect to each and every provision. In addition, there are many other avenues available to a department to provide or reiterate information to applicants, including guidelines, circulars and administrative bulletins. If an application form is provided by the department, notices could be provided on or with the form itself.

Given all that, I would suggest that this point should perhaps again be pursued with the department.


Mr. Dusseault: I support the recommendation in the document to inform the department that the fact that an agreement is not yet in place does not allay the committee's concerns, and that repetition is unnecessary in drafting the regulations. We should be able to improve the forms to clearly indicate that section 17 of the act sets out an obligation to give accurate information.


The Joint Chair (Mr. Albrecht): Mr. Abel, would you like to respond?

Mr. Abel: To be clear, are you suggesting that we pursue the removal of the provision given that it's redundant to the act?

Mr. Dusseault: Continue, as in the document, to tell the department that they should act in accordance with the fact that it's redundant and that it should not be in the regulations because it's already in the law.

The Joint Chair (Mr. Albrecht): I was a little confused. Maybe the interpretation didn't get it right.

Mr. Brassard: Do we know what the impact is with respect to no allocations on the softwood lumber exports at this point? Do we have any idea at all?

Mr. Bernhardt: Beyond our understanding that there is no longer an allocation as such, however you still need a permit. Whether those permits in practice are being issued on the basis of some, shall I say, informal system of allocation, I don't know. In the law there is no legal requirement for allocation.

Mr. Brassard: We are hearing of it daily in the house. Obviously this is a concern for members in British Columbia. Is there any way or any authority that our committee has, first, to find out what the government's intention is with respect to extending the Softwood Lumber Agreement, and, second, to hear from softwood lumber producers as to the impact and effect of this, given the fact that the agreement has not been extended? I know there is an intention to extend the agreement, but what is the government's intention? Do we have that authority?

Mr. Bernhardt: The last advice we had was prior to the expiration of the agreement, at which time I believe the department advised that it was, if I recall its words, hopeful that there would be a new agreement. Obviously there is a mechanism to freeze the status quo for a year, which I think will expire in October. At that point, all bets would be off.

When it writes back, the committee can certainly ask if there is an expectation of a new agreement. Whether there will be much of a response is hard to say.

Mr. Brassard: It would be worth the committee including in any response finding out the government's intention after the standstill or at least trying to get some indication from them.

I don't know whether I need a motion to move that, Mr. Chair.

The Joint Chair (Mr. Albrecht): Can we deal with the substance of the earlier material first? I'm just going to make an editorial comment that we need to concern ourselves primarily with the legal and regulatory aspects of this.

I think part of what you are getting at, Mr. Brassard, would fall under the Natural Resources Committee. That may be better dealt with in that forum, but the committee is the master of its own destiny.

Ms. Jordan: To your point, our role here is to deal with these regulations. Is that correct? So asking the government for an indication of where they plan on going with softwood lumber does not actually deal with this issue. I would suggest, respectfully, that we focus on what we are here for today.

The Joint Chair (Mr. Albrecht): Let's go back to the original intent of Mr. Dusseault's comment that we ask our counsel to correspond on removing these parts that are redundant and actually beyond the current law.

All in favour of that raise your hand. Opposed?

Mr. Brassard, if you care to make a motion, I'm prepared to accept it. I don't want to rule it out of order.

Mr. Brassard: I would agree with you, Mr. Chair, that that would likely be better dealt with at the committee level.

The Joint Chair (Mr. Albrecht): This doesn't close the door; we can come back to it.

Mr. Brassard: I understand that. Thank you.


(For text of documents, see Appendix E, p. 2E:1.)

The Joint Chair (Mr. Albrecht): Now we'll go to Item 5 under "Reply Unsatisfactory."

Mr. Bernhardt: Mr. Chair, the issue that arose here is the difficulty that has been encountered in finding out exactly if and when these regulations were actually made by the Canadian Nuclear Safety Commission.

Under the Statutory Instruments Act, proposed regulations are examined by the Department of Justice. The regulations are then made by the appropriate regulation-maker, in this case the commission. They are transmitted for registration and then published in the Canada Gazette.

In this instance, what apparently happened is the commission made a regulation, then sent the regulation to be reviewed by the Department of Justice after it had been made. After it had been examined by Justice, the president of the commission simply signed off on the regulations, without any involvement of the commission itself.

The commission first indicated that it made the regulations on June 19, 2014. That date doesn't even appear in the published version the regulations. The published version refers to November 3, 2014. This turns out to be the date that the president of the agency indicated that the commission made the regulations.

If they were made by the commission on June 19, then the commission didn't send proposed regulations to be looked over by Justice; it sent regulations it had already made. As well, if any changes were made as a result of the examination by the Department of Justice, there is a question of what authority the president had of his own accord to implement those changes into the regulations without sending them back to the full commission.

In its next response, the commission clarified that, in fact, it was proposed regulations that were approved on June 19. The commission then went on to say that Justice didn't suggest any modification or changes, so the president signed the version, under the approval of the members, that the commission obtained on June 19.

We've looked at the minutes from that June meeting. They don't go into any detail about precisely what was agreed to at the time, so it's difficult to tell whether the commission made the regulations or whether it simply approved proposed regulations. The act authorizes the commission to make regulations, and there is nothing in that suggesting they can subdelegate to the president the authority to incorporate any amendments down the road of his own accord.

The commission takes the view that it did not subdelegate to the president the decision to make the regulations, that it adopted the proposed regulations with the caveat that if there were no changes afterwards, following examination by Justice, then they would somehow be signed into force by the president. I suggest this simply cannot be. You can't make provisional regulations.

All the legal issues aside, I think that, as a practical matter, it goes without saying that it just shouldn't be this complicated to determine if and when a law was made.

The committee recently encountered a similar situation in relation to regulations made by Canada Post. The committee obtained an agreement from Canada Post to implement a new procedure that would require the corporation to make regulations after they had been examined by Justice, regardless of whether there had been any changes incorporated to the draft as a result of that examination.

Perhaps the same recommendation, the same procedure, could be suggested to the Canadian Nuclear Safety Commission. In addition to ensuring that the procedure complied with the requirements of relevant legislation and that you did have a legally enacted recommendation, this would have the benefit of providing a clear answer to the question of when the law was actually made. That would be our recommendation.

The Joint Chair (Mr. Albrecht): Just for clarification, if we made that recommendation, would we have the authority to actually implement that as the date of the regulation coming into effect, or are we asking them to make that decision?

Mr. Bernhardt: The committee would be suggesting that a procedure be put in place so that regardless of what happened as a result of examination by Justice, the regulations would come back to the commission to actually be made formally by the commission.

The Joint Chair (Mr. Albrecht): Does that clarify the situation that we are currently dealing with, or do we leave this one alone?

Mr. Bernhardt: It wouldn't address any potential uncertainty here.

As a practical consequence, if a nuclear facility was found in contravention of one of these provisions and had a very sharp legal counsel, they might try to beat the rap, as it were.

The Joint Chair (Mr. Albrecht): First of all, let's deal with the principle. Do we want to follow the same protocol procedure that was suggested by Canada Post moving forward? Then we'll come back to the second question as to whether or not we can take action to clarify, if there is any action possible on the current issue before us.

Mr. Di Iorio: Regarding the first aspect, we need a better standard than that. This item was noted and is now highlighted. It's documented, and not acting on it would not be an appropriate way forward.

Regarding the second component, it's going to come up at some point, so they might as well address it now instead of having to address it in a court of law or in the court of public opinion if the matter is revealed and made public. At some point, they are going to have to deal with what they did and put their minds to it. They can't simply brush it aside.

There might be a real issue. I'm not able to ascertain whether there is a real issue because it could be that they could cover the interim period where the regulation was not adopted according to proper —

The Joint Chair (Mr. Albrecht): I think the question we have now, however, is that we don't know which of the two. I don't think they are even suggesting, "Pick one of them." There is no clarity as to which one it is.

Mr. Di Iorio: We have highlighted a clear problem. I agree with comments made by our learned counsel that the view of the commission is not the appropriate one. You can't play around with these things. There is a process. Legislation and regulations are adopted. We're imposing context on individuals or depriving them of their rights or giving them rights. In this country, we need better standards.

The Joint Chair (Mr. Albrecht): Any further comments on the principle?

Mr. El-Khoury: I would recommend that any modification must meet the requirements of the Canadian Nuclear Safety Commission, and perhaps in some cases the Minister of the Environment should also be involved.

Mr. Genuis: I agree completely with what counsel and Mr. Di Iorio have said. This seems to clearly violate the basic rule of subdelegation. To say that the president would declare the regulations is effectively the commission seeking to subdelegate the final authority associated with making regulations. So I don't think there should be any ambiguity about the fact that that's not appropriate.

I think we should follow up with them and work with them in the same way that we did with Canada Post with respect to a process going forward.

With regard to this specific regulation, because of the concern of, as you mentioned, a particularly clever counsel trying to help someone beat the rap around these regulations by saying that they're not in force, could we ask the commission in a clearer and more proper way to make the regulation or reaffirm the regulation now so that regardless of when it was initially made, going forward we can definitively say that it was at least made properly now and therefore is clearly in force?

Mr. Bernhardt: That is certainly a suggestion the committee could make, that they had put the new procedure in place and then the first thing under the new procedure would be to remake these regulations.

Mr. Genuis: I would strongly suggest that.

Mr. Di Iorio: There might be a problem. I agree with the point made by Mr. Genuis, but the commission might say that there is a problem because people acted in the interval, and they might not be allowed to make a retroactive regulation.

Mr. Bernhardt: No, they can't.

Mr. Di Iorio: Depending on the nature of what is retroactive, there are some possibilities, but they are very limited.

Mr. Bernhardt: It solves any uncertainty going forward.

Mr. Di Iorio: Yes.

Mr. Bernhardt: There is going to be whatever uncertainty there was in the past.

The only absolute way to deal with that kind of thing is to ask Parliament to retroactively validate.

Mr. Di Iorio: The point I was making is that if that's their argument, the argument will at least be "boxed" instead of being indefinite in the future. It doesn't change anything. If it's not valid, we might as well put an end to it.

Ms. Jordan: With regard to a timeline, is there a way to request that this be done quickly? If this is out there without any regulation around it, it should be dealt with in the most expedient manner. I'm just wondering if, in the request, we can give them a timeline for when it should be enacted, changed.

The Joint Chair (Mr. Albrecht): Are we going to request that? I'm not sure if we want to suggest a date here.

Mr. Bernhardt: It depends on what the committee decides to ask for. If the committee is asking for a new process to be put in place, then the time that would have to be in place would be the next time they make a regulation. If the committee is looking at a remaking, then that's a somewhat different issue. The committee could suggest that be done as soon as possible or suggest it would like an update and a reply or a progress report by a certain time.

Ms. Jordan: My concern is just that there is no regulation at this point. Like you said, all it would take is legal counsel to say, "Well, there is no regulation; we can get through this and find a loophole." It's about closing the loophole as quickly as possible.

The Joint Chair (Mr. Albrecht): Is there a possibility that we could reverse the suggestion by Mr. Genuis and ask them to confirm the regulation as of today and then immediately expedite a new process going forward that would clarify this? I'm not sure if that answers the question.

Mr. Di Iorio: Maybe we should ask another question. If what they did is declared invalid, what is the consequence? They should explain that to us because our learned counsel made a good point: We might have to go to Parliament, depending on the extent of the consequences. We don't know what they did during their interval. We don't know how they acted and the extent of their intervention. It could trivial, but it could be monumental. We should at least know the consequences, if what they did is invalid, for the duration of the period in which they would then put into force a valid regulation.

Mr. Bernhardt: When we talk about things we don't know, I think members might also keep in mind that we don't know for certain that there is a problem, because we don't know what the commission did. We don't know exactly what was made and what was approved.

Mr. Di Iorio: I'm suggesting that we at least find out the consequences.

Mr. Bernhardt: That would, I suppose, be the way that the remaking would be put to the commission. It would for the purpose of resolving any uncertainty going forward.

Mr. Di Iorio: That they would be able to explain to us quite rapidly. It wouldn't take very long.

The Joint Chair (Mr. Albrecht): We hope.

Mr. Genuis: If I understand the process, right now might be a good time to make a motion with respect to some of these things. I'm going to propose —

The Joint Chair (Mr. Albrecht): Before you do that, I want to give Mr. Dusseault a chance to comment.


Mr. Dusseault: I would like to clarify something. Is the commission of the opinion that there is no regulatory void and that it acted in compliance with the regulations? This is probably what will be in the legal opinion, that there was no regulatory void regarding the regulations that have been adopted and that are currently in effect.

Mr. Di Iorio: That is not for the commission to decide. The commission was told that it has two options: either it is valid or it is not. There can be no other choice. What we are asking is this: if it is not valid, what are the consequences for the commission? If it explains that the consequences are major, we will then determine what action to take. However, if the consequences are general or not as serious, that will help us make our decisions. As our counsel said, we do not know what the commission did in the interval, because we are missing certain facts. This is also something the commission can clear up quickly. It does not take long for the commission to explain the consequences to us, unless it took a number of actions, which we do not know.


Mr. Genuis: I would like to propose a motion that we ask the commission to do three things: to remake the regulations, to establish a new process that respects the rules of subdelegation, and to provide us with a report on the possible consequences that would result if the regulations were not in effect in the interim. There is the legal question of whether or not they were in effect, but I think we would like to know, in the event that a court were to determine that the regulations were not in effect, what would be the possible consequences for the public?

The Joint Chair (Mr. Albrecht): You see the motion before you.

Mr. Di Iorio: I agree with everything Mr. Genuis said. However, I'm not sure — and I'm speaking very candidly — whether we should start with step 3 first and reserve steps 1 and 2, depending on the answer we get. I'm at a loss as to what they did during the interval. I would like to know what it is the commission did before taking actions 1 and 2. It would help.

Mr. Genuis: I wasn't, in any way, intending to imply a prioritization of those three things. I think all three of those things need to happen, but they can't happen at the same time. We need a new process regardless, and I think we should remake these regulations regardless.

Yes, the first priority could well be understanding what the possible consequences were and if we need legislation to address this retroactively, but I think we need to move forward on all three of those fronts.

The Joint Chair (Mr. Albrecht): I think there is general consensus. I'm ready to call a motion, but I want to be sure that counsel is comfortable with the direction in which we are heading before we make him head in a direction that may not be possible. Are we okay?

Mr. Bernhardt: I'm okay.

The Joint Chair (Mr. Albrecht): All in favour of the motion please raise your hand. Opposed?

Carried. Thank you.


(For text of documents, see Appendix F, p. 2F:1.)

The Joint Chair (Mr. Albrecht): We now move to Item 6 on our agenda, under the heading "Reply Unsatisfactory (?)."

Mr. Bernhardt: Chair, these regulations contain numerous references to provisions in the Canada Business Corporations Regulations. These regulations, however, were repealed and replaced in 2001. The history of the file, set out in the background section of the note and the materials, states that amendments to update these references were prepared in 2007. They were held back pending consultations on other regulations that resulted from amendments to the Bank Act. Then they had to be redrafted as a result of amendments to the Canada Business Corporations Regulations, 2001. Then they were put aside because of the uncertainty surrounding the creation of a national securities regulator.

In 2013, after the committee expressed its frustration, the department agreed to amend the regulations as soon as possible. After agreeing over a decade ago that these references should be corrected, the Department of Finance has advised that the matter is now more complex than anticipated and that an alternative approach would be required. The department is consulting with stakeholders. There is no indication as to when corrections will actually be made.

The Joint Chair (Mr. Albrecht): What is the alternative approach and how long will it take? Do committee members have any comments?

Mr. Badawey: It is somewhat frustrating when we see something that has gone on for so long with no corrections made. I would move that, as stated in the last letter, we once again ask that this be done in an expeditious manner and that a timeline be attached to it.

The Joint Chair (Mr. Albrecht): Attach a timeline for an expected response.

The Joint Chair (Senator Merchant): I would like to make a general comment. I'm sitting here thinking why are we called the Scrutiny of Regulations Committee when they pay no attention to us at all? Most of these things have been going on for a long time. What is our function?

Mr. Bernhardt: One caveat I would make for members — and members who have been on the committee for some time will have heard this before — the committee spends 99 per cent of its time on 1 per cent of its files. The cliché I always use is that the committee's focus is on the problem children. The vast majority of regulations that are reviewed present no problem and are submitted without comment. The majority of those on which there is an issue are resolved fairly expeditiously. A letter goes out and we get a reply. There is a promise of action. There may be some follow-up and the amendments get made.

For example, in 2015 more than 225 amendments were made to regulations at the request of this committee. A lot of those were small amendments that may be housekeeping matters, but I think, over time, that has a definite and substantial effect on the quality of regulations in Canada.

This morning, on the one file, we've already seen nine amendments made because the committee requested them. Obviously the committee doesn't spend a lot of time on those. It's duly noted that a file gets closed or nine amendments were made, and then the committee spends the other hour and 27 minutes on, as I call them, the problem children. Obviously where files are not going well or there is a dispute with the particular department over the correct position on an issue, those are going to take more of the committee's attention.

That being said, there are a number of files where the committee has difficulty getting departments to carry out promised action. I think that it is legitimate for members to explore ways to shake more coconuts out of the palm trees.

The Joint Chair (Senator Merchant): Can we then call somebody from the department on the issues?

Mr. Bernhardt: It can be done. At the last meeting the committee determined it wanted to hear from Environment Canada on a particular issue. That's always something that's open to the committee.

The Joint Chair (Mr. Albrecht): As well as the aspect of asking for a definite timeline in response.

Mr. Badawey: I think it's partly our responsibility to, in our responses, not only deal with the specific issue — in this case, looking for answers — but to deal with whether it's being expedited and that timelines are attached, with the expectation that they have and we have. I'm sure we're going to need another response based on our dissatisfaction with the timeline they are going to provide. However, I won't assume that; I will wait until that day comes.

As well, what is also our responsibility is the broader issue to send a message out to all departments in regard to every issue we deal with, that we attach timelines to them and set out a structure accordingly. We should send a strong message with respect to those responses that, quite frankly, we are not going to tolerate these things going on for a decade. We are here to do a job, which is to scrutinize regulations that are coming through, and we have a responsibility to make sure that happens in an expeditious manner. If it doesn't, they are going to hear about it.

Mr. Kmiec: To the point the joint chair made, this goes back to 2004. I agree. I respect the fact that this is a pretty complex file and that it has been changing. At least three or four ministries have been involved in this, but department officials have presumably been the same, and there was a Supreme Court reference on the securities file in 2011 that considered this.

I would be more interested in simply calling witnesses from the department to come and explain to us how this alternative approach will affect the regulations, specifically the wording the regulations and what they look like. The subject matter expert on this will have to explain this mystical alternative approach: What does it look like on paper, in black and white? How would parties comply with it? Why is it so complex? To my mind, they can just go back and strike out the offending words that are now antiquated due to everything that has happened over the past 10 years. That would probably satisfy us. A letter is nice, but I think it has to go to the next step.

I'm going to look to counsel: Beyond a letter, what is the next procedural step the committee can take to seek compliance?

The Joint Chair (Mr. Albrecht): Counsel just commented that another step we could take, rather than simply communicating with bureaucrats, is send a letter directly to the minister. I have a feeling, in defence of ministers, many of them are not aware that these things are lagging, taking 10 years, using a lot staff time and killing many trees. I don't think they are aware of it. A letter directly to the minister, once we reach a certain point, may be another way to turn up the heat.

Mr. Di Iorio: I agree.

I also agree with the fact that calling a witness is very useful, because coming to testify before a joint committee of this Parliament requires preparation. Answering a letter requires certain level of preparation, but preparing for testimony requires greater preparation. More people are involved, and after they come here, maybe they will go back and say, "We have to address this; it hasn't been done." I think it could be a useful exercise.

Senator Runciman: A lot of these comments sound awfully familiar. I wonder if it might be appropriate for steering — which meets very rarely on this committee — to develop, along with counsel, a proposal that it can bring to the committee with ways to address this going forward. We can work on that. I know the steps that we go through. In drafting a letter from the joint chairs to the minister, I wonder whether we would incorporate an indication to the minister at that time that this is going to result in the calling of witnesses or officials to the committee and/or tabling a report in both the Senate and the House of Commons to emphasize the significance of it. We should have some kind of a format that we can work from and set a bar in terms of time.

There probably will be exceptions for a variety of reasons and we can deal with them at that time, but let's have some kind of guideline for committee members going forward with respect to how we should deal with these problem actors.

The Joint Chair (Mr. Albrecht): Those are great suggestions. Our counsel will follow up on some of the ideas that we can maybe implement at one of our next meetings in terms of providing specific time lines and letters to the minister, including threats.

Mr. Bernhardt: I took the senator's suggestion as recommending doing it through the steering committee, but we can bring it back to the full committee.

The Joint Chair (Mr. Albrecht): Did you suggest through the steering committee?

Senator Runciman: The steering committee, working with counsel to develop a proposal to bring back to the committee for consideration.

The Joint Chair (Mr. Albrecht): Shall we proceed in that manner?

Mr. Kmiec: I share Senator Merchant's viewpoint. Can we not just call the department's subject matter expert on this?

The Joint Chair (Mr. Albrecht): We are talking more about a general procedure so that we don't have quite as big a binder for the same material over and over. That's the issue to wrestle with now, in a general way, as opposed to a specific solution for this one.

We will deal with this one by writing a letter to the minister, but going forward, we want to have a general principle that minimizes these kinds of 10-year cycles.

Mr. Kmiec: I'm speaking more to this issue, so I will wait until we resolve it.

Mr. Badawey: I need clarification. I see the broader issue that Senator Runciman is proposing and I agree with that.

With respect to this issue here, are we proceeding to send a letter in response to this, as I suggested earlier, as well as sending a letter to the minister and looking at the possibility of bringing a witness here?

The Joint Chair (Mr. Albrecht): I don't think we can do all three at once.

Mr. Bernhardt: We could certainly send a letter to the minister. If members wish, we can advise the minister that in the absence of an expedient resolution, the committee will consider next steps, whichever options are available to it.

Mr. Badawey: Are we also going to respond to the department itself, or straight to the minister?

The Joint Chair (Mr. Albrecht): I'm sensing there is consensus around the table that this has gone on long enough: Let's get it to the minister. Obviously copy the persons who have been involved before, but we need action. I see a lot of nodding heads. We will authorize our counsel to proceed in that manner and it will go out under our signature.

Mr. Badawey: Fair enough.

Ms. Jordan: Can I ask a quick question? They continually fall back on the national securities regulator. Has that ever been struck? No? So they can still fall back on that. I just want to know if it has actually ever happened.

Mr. Bernhardt: No, but I suppose in their view they would rather see a massive set of amendments. On the other, we have references to provisions that disappeared 15 years ago.

Ms. Jordan: They have never actually developed it, though.

Mr. Bernhardt: I believe it is a bit tenuous to link updating a reference to a provision of another act to the securities regulator.

The Joint Chair (Mr. Albrecht): Move to item 7, wage earner protection regulations.


(For text of documents, see Appendix G, p. 2G:1.)

The Joint Chair (Mr. Albrecht): We will now move to Item 7 under "Part Action Promised."

Mr. Abel: Nine issues were raised with respect to these regulations. It took some two-and-a-half years to receive a substantive response from the department despite several follow-up letters and also a conference call, and later a meeting with departmental officials and the committee's counsel.

What we have now is the department's letter of May 29, 2015, which agrees to make amendments addressing one point and parts of two other points, all of which concern drafting matters.

In addition, the department's response on paragraph 16(1)(b) of the regulations, which is point 8 in the note in correspondence, could be considered satisfactory. This provision requires a trustee or receiver to inform an individual they are required under the Bankruptcy and Insolvency Act to submit a proof of claim for wages owing. Given that a proof of claim must be submitted in the form prescribed by the Superintendent of Bankruptcy and that it's not readily apparent how to identify or obtain that form, we suggested that the trustee or receiver could be required to provide a copy of the form.

The department indicates that the Bankruptcy and Insolvency Act already requires that form to be provided to all creditors, which would include anyone having a provable claim. One caveat is that the act only refers to trustees rather than trustees and receivers, but in practice the form is likely sent out in all cases.

With respect to the remainder of the issues, it is suggested that the department's responses may be unsatisfactory. A detailed analysis is set out in the note prepared for members today. Without going into each matter at length, suffice it to say that the points concern the clarification or elimination of apparent redundancies and discrepancies between the French and English versions; a suggestion to amend a timeline to apply for benefits, which in practice may be shorter than it appears in the regulations; the clarification of provisions allowing applicants to seek more time to apply for certain things under the regulations; and dealing with drafting inconsistencies identified between the regulations and the act.

Finally, it was noted that section 19 of the regulations would appear to be ultra vires the enabling act. It purports to authorize compensation to a trustee or receiver for fees and expenses for the administration of an estate or property. This would be distinct from fees and expenses incurred in the performance of duties under the act and, as such, there does not appear to be authority to make regulations authorizing the minister to pay for such fees and expenses. The department has not provided a substantive response yet on this point.

If members wish, another letter could be drafted pursuing these matters, along the lines set out in the note, and seeking a progress report on the already-promised amendments.

Senator Runciman: This ties in pretty well with Senator Merchant's frustrations. This is a voluminous amount of correspondence. I think the cover memo is 11 pages long. It appears that department officials are pretty unresponsive, and I think this is an area where the joint chairs should write to the minister.

I wonder if we should incorporate fairly frank language in these letters to convey the frustration of the committee with the unresponsiveness of officials within the department and perhaps indicate the further steps that the committee may be compelled to take. Spell it out.

The Joint Chair (Mr. Albrecht): I think I see general agreement. Are there any further comments?

Mr. Di Iorio: I would appreciate some clarification from the senator. The senator indicated earlier that some of these comments have been heard before. Are there situations where the committee called witnesses? What were the consequences, and how did that occur?

Senator Runciman: It has been talked about. I know witnesses have been called in the past, not too frequently, though.

The Joint Chair (Mr. Albrecht): We decided at the last meeting to call witnesses.

Mr. Bernhardt: It's something the committee has done in the past, albeit fairly infrequently. It's had considerable success some of the time. Sometimes, where the committee has been unable to get a response, it has simply advised that in the absence of a written response it would like that response provided in person at the next meeting. That's often quite efficacious in getting a response where the issue is delay in carrying out promised action. That has been useful on occasions and at other times less so.

By coincidence, the next item but one on the agenda this morning deals with a file on which the committee did call witnesses at the end of the last Parliament with, as I think you'll see, mixed success.

Mr. Di Iorio: That's why I appreciate Senator Runciman's comment that we might establish a steering committee. Counsel could then assist us in setting up grand categories.

To go back to Senator Merchant's example, what action should we take when we have someone who has been — sorry to use this expression — delinquent for 10 years? That would probably help counsel, prior to the meetings, to set up a list of options available to us and to indicate which ones would be feasible or recommended.

Ms. Jordan: I'm new, but listening today it seems to be an ongoing problem that it takes forever to get responses to some of these things from department officials.

Is it possible to put a timeline to that? If we don't have an adequate response within, say, a year, which to me is still a lot of time, it should go right to the minister so that it doesn't drag on for 4 years or 10 years.

The senator has said that this is an ongoing issue and something the committee has dealt with for many years. If the committee does not get an adequate response, is the next step to say, "We'll just bypass the department and go right to the minister," and outline the problem that this is taking too long to address.

Could that be a standard that we actually put in place? Counsel could say, "We have not had a response for a year, so now I'll go to the committee and recommend we go right to the minister."

The Joint Chair (Mr. Albrecht): I think that's a great suggestion. It has happened in the past.

Mr. Badawey: I do appreciate the comments being made, in particular those by Senator Runciman. It is unfortunate this has been going on for quite some time and that it has not been dealt with.

It's up to us. Moving forward — and I'm not sure if this has already been attempted — I think that to every issue we are dealing with we have to attach not only direction but a recommendation that includes a timeline. Every direction we give, on every issue we deal with, should include a timeline. That's the discipline we would expect the different departments to operate under.

The second part of that is that, yes, if in fact the committee is impatient and it is due time for an answer, then we should send a letter to the minister. I would even go a step further, as Mr. Di Iorio has suggested, and call them in as witnesses. You can call it whatever you want, but at the end of day calling them before us can be a lot more effective than a simple letter. Therefore, when they are here face-to-face with us, we can give them our expectations with respect to the timelines that we've attached to even the correspondence we've already sent.

The Joint Chair (Mr. Albrecht): I think we've had plenty of discussion around the principles of what we are trying to getting at. The steering committee will come back, after working with counsel, to draft clear guidelines moving forward.

Have we dealt with Item 7? Remind me where we are. We are going to draft a letter to the minister —

Mr. Bernhardt: Pursuing these points and pointing out that the committee doesn't wish to wait two-and-a half-years for a response this time.

The Joint Chair (Mr. Albrecht): We will go directly to the minister and request a general timeline in which they will be expected to respond.

If we threaten disallowance, could counsel remind us what action it might create?

Mr. Bernhardt: Under the disallowance procedure, the committee would table a report recommending that a particular provision be disallowed. That report then has to be adopted by the two houses. If it is adopted, there is a provision that if there is no vote or debate after 15 days, it's deemed adopted by the two houses.

At that point, the regulation-maker has 30 days to remove that provision. In a sense, the committee's power is simply to recommend disallowance, but it would still have to be adopted by Parliament.

The Joint Chair (Mr. Albrecht): All in favour of proceeding with a letter to the minister requesting action and a definite timeline as well?

Hon. Members: Agreed.







(For text of documents, see Appendix H, p. 2H:1.)

The Joint Chair (Mr. Albrecht): Under the heading "Part Action Promised," Item 8 deals with the Cost of Borrowing Regulations.

Mr. Abel: Five matters were raised by the committee and have been resolved by amendments, as well as one other matter by way of an administrative correction. These all included concerns about drafting and equivalency between the two official languages.

There are three remaining matters. Of these, an amendment to paragraph 7(2)(c) is promised in order to set out a minimum rescission period that must be provided in a credit agreement in order to relieve the lender of providing a disclosure statement.

In connection with section 6(2.4)(c), the committee previously considered the requirement — a disclosure statement on margins such that sufficient white space be provided around the text — to be quite vague. The department suggested that financial institutions are not troubled by this requirement and that the purpose of maximizing legibility, as expressly stated in the regulations, aids in the interpretation of the terms and, finally, that being more precise would deny flexibility to financial institutions in designing their disclosure statements.

None of this seems particularly illuminating. Obviously, the requirement to provide sufficient white space and sufficient margins is, to some extent, meant to aid legibility, and some kind of limitation on what financial institutions may design is intended. The question, however, of what the actual limitations are remains as opaque as ever.

Without some determinable meaning, this provision simply leaves it to the complete discretion of the Financial Consumer Agency of Canada to decide what it would like this requirement to mean. This leaves open the possibility that interpretation will vary in an inconsistent or arbitrary manner. Furthermore, no one reading the regulations is able to determine precisely what the financial institutions are required to do. I would suggest this is more than just a matter of concern for the institutions themselves. If the department is concerned with maintaining flexibility, it would seem possible to provide, for instance, a range of measurements or some other options to which disclosure agreements could conform.

Finally, in connection with paragraph 7(2)(d), a similar issue was raised regarding the meaning of the phrase "favourable terms," which if included in a credit agreement relieve a lender from having to provide a disclosure statement. Other than the example of a favourable term set out in the provision itself, which is "no penalty or fee for early payment," the department is still unwilling, or possibly unable, to provide further explanation as to what terms might or might not satisfy this provision.

Must favourable terms be as favourable as the example given? How would that be measured? Could a technically favourable term be so minimal or trivial as to not relieve lenders of the obligation to provide a disclosure statement? If so, what distinguishes one from the other? What factors or indicators are there of an actual favourable term?

In failing to provide any elucidation, the department states that it prefers not to unduly limit the application of this paragraph by specifying its meaning, because the pace of the financial industry and the development of new financial products is so swift. It is some wonder, then, that seven years after this provision was brought into force, the department cannot identify a single other example of a favourable term that might satisfy paragraph 7(2)(d). Again, this lack of explanation or clarification simply grants wide discretion to officials to decide how it will apply the provision.

Readers of the regulations, however, have no way of knowing what lenders may or may not do to avoid providing a disclosure statement with a credit agreement. Having gone to the department twice with these concerns and receiving little in the way of helpful explanation, much less agreement to address the committee's matters, members may wish to consider a letter to the minister.

The Joint Chair (Mr. Albrecht): I think we might. I see a lot of agreement here. Are there any questions or comments?

Mr. Brassard: I think it's important to understand, too, that if they can't define favourable terms, how can we expect consumers to define them or have a reasonable expectation of what it means?

I would agree that we should send a letter, Mr. Chair. Failing any resolution at all on this matter, this may be a situation where we call someone in as a witness, for sure.

The Joint Chair (Mr. Albrecht): Any further comments? If not, we are going to proceed in that manner.


(For text of documents, see Appendix I, p. 2I:1.)

The Joint Chair (Senator Merchant): Next on our agenda is Item No. 9, again under the heading "Part Action Promised."

Mr. Bernhardt: One hundred fifty-three points were raised with these regulations in 2011. The Labour Program repeatedly indicated it was reviewing and consulting on the comments and would address them in due course. At the same time, where the review of regulation gives rise to concerns that are brought to the attention of the regulation- maker, the committee can only fulfill its mandate if it receives a reply that deals with the substance of those matters. This is especially the case where, at first review, we simply ask a question or for an explanation.

The Labour Program was advised of this more than once, and each time a response that dealt with each point in turn was promised. No sufficient response was forthcoming, however.

Last spring, the committee invited departmental witnesses to appear in order to explain the approach they took to matters raised by the committee, and that appearance took place on June 11. At that time, departmental witnesses undertook to provide a detailed response on each of the points raised. They also proposed further meetings with the committee's counsel to enhance interaction and to facilitate more regular and timely correspondence. Members of the committee viewed this proposal in a positive light.

Most recently, accompanying the Labour Program's September 17 letter is a table that they describe as outlining how the Labour Program intends to address each of the committee's concerns.

The points that were first raised almost five years ago now have been divided into three categories. Amendments to address the issues in the first category, of which I believe there are some 66, are to be made as a miscellaneous amendments package that they expect to seek in 2016.

With regard to the issues in the second and third categories, the Labour Program states as proposing a phased approach, and they promise an update once consultations are complete. Spring of 2017 is apparently the target date for prepublication of further proposed amendments.

Unfortunately, however, we have gone another year and the department still has not provided a response on the substance of each of those 153 points. As I said, what is involved in some cases is a question. The latest correspondence indicates that amendments will be made to resolve a number of points, and that's true, but the only actual undertaking in connection with the other points is to consult with a view to answering the committee's questions and making amendments as needed.

By coincidence, it turns out that the next meeting we're to have with representatives of the Labour Program in order to be briefed on developments is to take place tomorrow. That being the case, I'm in members' hands as to what message the committee would like me to bring tomorrow morning.

Mr. Genuis: I was actually relieved to see there were only 153 errors, so that's encouraging.

More seriously, we should request a more fulsome and appropriate response. This would strike me as a case where it's worth copying the minister and just advising the minister of some of these ongoing concerns and the fact that we received replies that are not satisfactory.

The Joint Chair (Senator Merchant): Is everybody in favour of that suggestion?

Hon. Members: Agreed.


(For text of documents, see Appendix J, p. 2J:1.)

The Joint Chair (Senator Merchant): We will move on to Item 10, again under "Part Action Promised."

Mr. Abel: The National Energy Board has agreed to make amendments addressing six more issues raised by the committee, in addition to five previously promised amendments.

There is one matter that remains outstanding. Point 13 in the correspondence concerns the requirement that companies establish a number of programs, policies, goals, measures and other documents, and the corresponding requirement that the company, its agent or mandatary must ensure these policies are complied with.

The effect of this latter requirement is that the contravention of a manual or other standard or rule established by a company effectively becomes a contravention of the regulations. A contravention of the regulations, in turn, is an offence under the enabling act.

The department was referred to the committee's Report No. 78, which sets out the committee's view that a new offence cannot be created by way of subordinate legislation without clear or express authority, in particular by making it a requirement of a regulation to obey a condition or term of a permit or licence issued by an administrative official. Such an approach empowers an official to effectively make law, the contravention of which attracts the possibility of prosecution or penal sanction.

The board does not agree that Report No. 78 applies in that situation and argues that the act provides a broad enough authority to make it an offence for a pipeline company to contravene the administrative documents that it has issued. The board evidently takes the committee's position as set out in the report as being limited to terms and conditions of licences or permits issued by administrative officials. It should be obvious, however, that the potential for suffering penal sanctions for contravening documents created by private companies poses even more troubling questions and is even less likely to be seen to be authorized by the act.

In any case, these and further arguments made by the board were considered unpersuasive by members last May, at which time the committee also noted some inconsistencies in terminology used in the provisions in question.

All of this was put to the board in a June 2015 letter, and the board's reply indicated that it would be working with the Department of Justice to provide a response by fall of this year. At this time, perhaps a letter could be drafted seeking an update on making the promised amendments and on preparing a response to this remaining point.

Mr. Kmiec: I agree with the explanation in here.

Point 5 of the scrutiny criteria of this committee states: "imposes a fine, imprisonment or other penalty without express authority having been provided for in the enabling legislation." So I think we should send a letter reminding them that that is the point.

I'm not as concerned about the lack of clarity and why it would take an extra year of study. It is a technical regulation, so a letter would be fine to follow up and see when they expect to have the answer. Within the year? An update is all we need.

The Joint Chair (Mr. Albrecht): Can we put a date in there, like the end of October, rather than simply saying "fall"? It's so vague. Even if it's an earlier date, that's fine, but no later than the end of October.


(For text of documents, see Appendix K, p. 2K:1.)

The Joint Chair (Senator Merchant): Next is Item 11, under the heading "Part Action Taken." Have we received a satisfactory reply?

Mr. Abel: Madam Chair, I would mention for members' benefit that two matters were resolved by the making of the amendments. These were correcting a drafting error and clarifying requirements found in two provisions.

There is one promised amendment remaining. This would add a definition. That was expected to be made in late 2015. It has yet to be made, so I would suggest the department could be asked at this point when the amendment is forthcoming.

Senator Runciman: They refer to an amendment "at the next available opportunity." We should write back and ask for clarification on that.

The Joint Chair (Senator Merchant): Is everybody good with that?

Hon. Members: Agreed.


(For text of documents, see Appendix L, p. 2L:1.)

The Joint Chair (Senator Merchant): Item 12 falls under the heading "Reply Satisfactory."

Mr. Abel: Very briefly, it was noted that a citation in the opening portion of the regulations for an enabling authority was missed. The department agrees this was an error, and they provided a commitment to ensure that future amendments will make the proper citation.

The Joint Chair (Senator Merchant): Shall we just let it go then?

Hon. Members: Agreed.


(For text of documents, see Appendix M, p. 2M:1.)

The Joint Chair (Senator Merchant): Item No. 13 is under the heading "Reply Satisfactory (?)."

Mr. Bernhardt: Without going into detail, the issue here was originally the enabling authority for the provision dealing with authorized foreign banks. The discussion — of what the appropriate enabling provisions were — led us to make the suggestion that section 458.2 of the Bank Act is now redundant.

The Department of Finance has replied they have taken note of this and will keep it in mind for future review. While this is not the firmest of undertakings, at the same time, the question of whether a provision in the act is or is not redundant at this point might be thought to be on the periphery of the committee's mandate. If members are not inclined to pursue that particular point, we could just close the file.

The Joint Chair (Senator Merchant): Is it agreed?

Hon. Members: Agreed.


(For text of documents, see Appendix N, p. 2N:1.)


(For text of documents, see Appendix O, p. 2O:1.)


(For text of documents, see Appendix P, p. 2P:1.)

The Joint Chair (Senator Merchant): The first item under "Progress" is No. 14.

Mr. Bernhardt: We can deal with Items 14, 15 and 16 together. I will simply note that we have promised amendments. Those have been progressing.

The undertaking we have on the first two is that they expect action to take place this spring. We can monitor that, and if that turns out not to be the case, we'll follow it up.

On the Immigration and Refugee Protection Regulations, there is a part solution in an amendment to the act made by the Economic Action Plan 2015 Act, No. 1. When that provision comes into force, it will provide clarity, and then it will be necessary after that to amend the provisions in the regulations.

So we seem to be moving toward a solution there. At this point, what's needed is to bring that provision into force, so the committee can wait for that.

That would resolve the matters under "Progress."


(For text of documents, see Appendix Q, p. 2Q:1.)


(For text of documents, see Appendix R, p. 2R:1.)


(For text of documents, see Appendix S, p. 2S:1.)


(For text of documents, see Appendix T, p. 2T:1.)


(For text of documents, see Appendix U, p. 2U:1.)

The Joint Chair (Senator Merchant): Items 17, 18, 19, 20 and 21 fall under the agenda heading "Progress (?)."

Mr. Bernhardt: We will need to go through some of these individually because of the question as to where these things are at.

Item 17 deals with amendments to Processed Products Regulations. The committee noted that some provisions in the regulations use imperial units and others use metric units. This has been something that the committee has been waiting on for some time. It is now part of a broad regulatory modernization initiative resulting from the new Safe Foods for Canadians Act. The Canadian Food Inspection Agency has been working on new regulations to implement this for some time.

The Joint Chair (Senator Merchant): Are we at 16 or 17?

Mr. Badawey: I was going to propose that the progress reports be received and that a letter be sent out to the different organizations to ask for a timeline and an update.

Mr. Bernhardt: If that's the committee's will, can we take that for the rest of them?

The Joint Chair (Mr. Albrecht): I have a question on Item 19. I am wondering what impact Bill C-18 and the International Union for Protection of New Varieties of Plants have had on this. Or is that a moot point in terms of these seeds regulations? They don't refer to it in their correspondence, but I was surprised they didn't.

Mr. Bernhardt: It seems what happened in this case is that the committee's amendments were wrapped up with a broader review that may have stemmed from that. The committee indicated it was not happy with that proposal and wanted to see its amendments go ahead independently rather than wait for this broad review.

The agency agreed to do that. That may or may not have sped things up, in retrospect, but now the agency is saying that it expects to complete them this summer.

The Joint Chair (Mr. Albrecht): I will make a note that I think it should be clear that there could be further regulatory changes based on Bill C-18.

Mr. Genuis: I have a comment on Item 17. I wonder if there is something more complex than meets the eye here, because it says that the changes being made are complex and lengthy. We are talking conversion of units, and this has taken 20 years. This is beyond ridiculous.

Am I missing something? Maybe we should suggest they use a computer or something.

Mr. Bernhardt: When they refer to the changes being complex and lengthy, they are referring to this broad modernization review into which they have lumped the committee's amendments, which is often something the committee hears from a department. The committee will raise two or three particular, very narrow points, and the department will reply, "Well, we're doing a broad review of the regulations, and we'll fix the committee's concerns at the same time."

Then years go by, and the committee is told, "We have this very complex initiative. It may be a complex initiative globally, but the committee's portion of it is a very small, finite, technical aspect.

That is what happened on the file that the joint chair was questioning. The committee eventually said, "No, please take our amendments out of this complex initiative; just do them separately and get them over with." That's something the committee can consider suggesting in some instances, as well.

Mr. Genuis: We're talking about the conversion of units, not a matter that is super urgent or injurious. But at some point, if it's going to be done, it should just be done. I don't know if there anything more we can do, but for the record, this is insane.

The Joint Chair (Senator Merchant): Thank you.

Mr. Genuis: Someone's office staff will take care of it.

Mr. Bernhardt: As I say, the proposal for each of these files at this point would be to follow them up and ask for progress reports, as appropriate.

The Joint Chair (Senator Merchant): Nobody was listening to you, so we are agreeing with it.

Mr. Genuis: I missed the discussion of Item 21. Did we discuss that?

The Joint Chair (Senator Merchant): They were together. Have you a question on No. 21?

Mr. Genuis: What was our recommendation moving forward on Item 21?

The Joint Chair (Senator Merchant): It was just to follow up.

Mr. Bernhardt: Yes, the interim marketing authorization. The department has advised that it anticipates public consultation this spring. Again, the proposal would be to write back to the department, ask for update on that and see if they can provide a time for actually wrapping this up, getting rid of this last authorization and rolling it into the new regime.

Mr. Genuis: I have concerns about that particular approach. My view is that when we are dealing with food safety, the law should be enforced as long as it's in place. I don't think we should just wait. With respect to an issue this important, we should write to them to say that if a market authorization is not in place, then the law should be enforced or one should be issued.

This is how we ensure the integrity of regulations on a matter of great importance. I'd be curious what other members think, but that would be how I suggest we approach this one.

The Joint Chair (Senator Merchant): Are there comments? We will go ahead with your suggestion. I think it's good.

The Joint Chair (Mr. Albrecht): The point is they promised action in the spring of 2016, and we're here.

The Joint Chair (Senator Merchant): We are here, so let's see it. I agree we should. That's good.


(For text of documents, see Appendix V, p. 2V:1.)


(For text of documents, see Appendix W, p. 2W:1.)


(For text of documents, see Appendix X, p. 2X:1.)

The Joint Chair (Senator Merchant): Next are Items 22, 23 and 24 under "Action Promised."

Mr. Abel: Madam Chair, on Item No. 22, for members' benefit, I will mention that this makes eight amendments addressing previous concerns raised by the committee. There are now promised amendments to address one new matter and two matters carried over that were not addressed before.

We received a letter recently that is not in the package. It indicates that these might be made very soon, so I suggest we follow up in the usual manner.

The Joint Chair (Mr. Albrecht): I have a quick question on Item 22, specifically the last sentence under point 1. I may be missing something. It says:

Moreover, one of the changes made had the effect of making the criterion used to determine whether a vessel is entitled to a reduced fee for icebreaking services an objective criterion rather than a subjective one.

To me, that would be a good thing. Am I missing something?

Mr. Abel: Possibly there is a translation error, but what happened was that the committee insisted on the removal of subjective language, which is something the committee regularly recommends.

The Joint Chair (Mr. Albrecht): In my view, this is worded opposite to what we want.

Mr. Bernhardt: The idea would have been to remove the subjective one.

The Joint Chair (Mr. Albrecht): And replace it, but this implies the other.

Mr. Bernhardt: That's a translation error.

The Joint Chair (Senator Merchant): That's good.


Mr. Kmiec: I would like to say something. This is a problem I see in many regulations. There seems to be a problem between the French and English definitions. Some departments have difficulty keeping with their own definitions in the legislation. I do not know if the committee can ask the House of Commons Official Languages Committee to look into this, because it seems that it is a systematic problem for some departments. I am speaking in French because I think it is important. We are a bilingual country, and I thought the government would be able to draft regulations in both official languages.


The Joint Chair (Senator Merchant): No problem. I agree.

Mr. Kmiec: My point was that if we tell them they have a problem getting the right versions —

Mr. Bernhardt: The committee raises those issues when it encounters them. Unfortunately, a certain amount of the committee's work involves trying to get these discrepancies resolved. I don't know whether it's a systemic problem. There are always going to be errors and discrepancies.

The Joint Chair (Senator Merchant): But it's happening frequently, so we should do something about it.

Mr. Kmiec: Yes, this is not the first time I have seen a significant difference between the French and English.

You mentioned at the last meeting, and I think Mr. Di Iorio did as well, that there are significant volumes of legal texts about the interpretation of French and English, but this is the federal government. They are supposed to set the standard, I would think, in getting it right the first time. And you would think that many people would have seen it before it comes to this committee; lots of hands and legal minds would have been at work on this. I would think they would get something as simple as saison des glaces versus saisons des glaces, which have two different meanings. There are other regulations in here and in the previous one that had this error. I'm just saying it seems to be a systemic problem, and it would be something that the Official Languages Committee could look at.


Mr. Dusseault: Thank you for raising this point. To address Mr. Kmiec's concerns, the committee could send a letter to the chair of the Official Languages Committee saying that our committee often notes translation problems between the English and the French, as well as problems with legal definitions. Perhaps the Official Languages Committee could raise this issue. We cannot ask the committee to do so, but we can at least inform the chair, who could notify the members of his committee that he has received a letter, which might lead the committee to study the matter.


Mr. Bernhardt: If it's something this committee might wish to look into.

The Joint Chair (Senator Merchant): Could we agree to write a letter to the Chairs of the Official Languages Committees to inform them of what is happening? Would someone make a motion?


Mr. Di Iorio: I agree with Mr. Kmiec and Mr. Dusseault's suggestions. It would be a good way of doing it, and the Official Languages Committee would be authorized to call witnesses and report back to us.


Mr. Bernhardt: If it's something the committee is interested in, the regulations generally go through the regulation section of the Department of Justice. If the committee would like for someone to come in and give the committee a briefing on what it does by way of ensuring consistency between the two languages and what it's processes are, that's something the committee could do.

Mr. Di Iorio: We noticed this in other areas, and it is problematic in the sense that we can be bilingual, trilingual or how many languages you want to speak, but when we express ourselves orally, individually, we allow for a learning curve, and every effort is greatly appreciated. But when it's an official instrument or something made public by the government or a government official, it's a different standard. Then we expect it be adequate and, I would even say, perfect. Certainly in matters of regulations, we require that it be perfect.

Therefore, we could ask the committees, or we could also ask that someone come here and explain how they do it. Nothing prevents both committees from doing it, because Official Languages could look at it more broadly. In our case, we would have a better understanding.

Mr. Kmiec's point was well made: These tend to happen often, so maybe we should be enlightened as to why they happen and why they are not spotted.

The Joint Chair (Senator Merchant): What is the wish of the committee? I asked for a motion.


Mr. Di Iorio: Could they come here and explain why these errors occur?


The Joint Chair (Senator Merchant): It's a different motion.


Mr. Dusseault: We can certainly do both: draft the letter to the Official Languages Committee to inform them of the problem that our committee sees on a constant basis, and perhaps also invite a witness for the next committee meeting to tell us about the procedures in place for drafting regulations, especially when it comes to English-French translation and legal definitions.


The Joint Chair (Senator Merchant): All right. We have that motion, then, to do both things: write the letters and also call a witness. Is the committee in agreement?

Hon. Members: Agreed.

The Joint Chair (Senator Merchant): That's what we'll do. Thank you very much.

Mr. Bernhardt: So for Items No. 23 and 24, we will follow up in the usual manner.


(For text of documents, see Appendix Y, p. 2Y:1.)


(For text of documents, see Appendix Z, p. 2Z:1.)


(For text of documents, see Appendix AA, p. AA:2.)

The Joint Chair (Senator Merchant): We will deal with the next three items on our agenda together. They are under the heading "Action Taken."

Mr. Bernhardt: Regarding Item 25, a drafting error in the French version has been corrected by way of an administrative correction.

With regard to Item 26, the committee was concerned about the scope of a discretion conferred on a provincial minister. That provision has now been repealed.

Under Item 27, there is a correction made to a reference in the French version that the committee had requested.




















Mr. Bernhardt: Finally, just for the record, under "Statutory Instruments Without Comment" are 19 instruments that have been reviewed and found to comply with all the committee's criteria.

The Joint Chair (Senator Merchant): Thank you very much.

(The committee adjourned.)

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