Proceedings of the Standing Senate Committee on
Transport and Communications
Issue 11 - Evidence, November 18, 2014
OTTAWA, Tuesday, November 18, 2014
The Standing Senate Committee on Transport and Communications met this day at 9:30 a.m. to study the subject matter of those elements contained in Divisions 2, 6, 10, 11, 16, and 21 of Part 4 of Bill C-43, A second Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures.
Senator Leo Housakos (Deputy Chair) in the chair.
[Translation]
The Deputy Chair: Honourable senators, today we are beginning our study into the subject matter of those elements contained in Divisions 2, 6, 10, 11, 16 and 21 of Part 4 of Bill C-43, A second Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures.
[English]
Today, we are beginning our study into the subject matter of those elements contained in Divisions 2, 6, 10, 11, 16 and 21 of Part 4 of Bill C-43, A second Act to implement certain provisions of the budget tabled in Parliament on February 11, 2014 and other measures.
We have two panels. Our first group is from Transport Canada: Donald Roussel, Acting Assistant Deputy Minister, Safety and Security; Shari Currie, Acting Director General, Civil Aviation; Joyce Henry, Director General, Marine Policy; Tamara Rudge, Director, Port Policy; and April Nakatsu, Director General, Crown Corporation Governance.
We will invite the witnesses to make their presentations, and then senators will have the opportunity to ask questions. Welcome.
Donald Roussel, Acting Assistant Deputy Minister, Safety and Security, Transport Canada: I'm pleased to be here today to speak to the legislative amendments to the Aeronautics Act regarding aerodrome developments being proposed by the Minister of Transport.
While Transport Canada's top priority is safety, I would be remiss not to recognize the enormous economic impact the air sector has in Canada. This industry has a massive economic footprint of $35 billion in GDP, currently employs almost 405,000 people across the country, and operates over 300 airports and approximately 7,000 aerodromes.
In order to achieve and sustain truly effective transportation legislation and policy, a healthy balance must be struck between protecting the public and facilitating economic growth opportunities for the benefit of Canadians. Transport Canada has historically exercised this responsibility through the development of regulations and policies that support the freedom to fly in Canada but, more specifically to our discussion here today, by permitting the establishment of aerodromes without requiring authorization from the federal government.
This approach and philosophy has contributed to the successful state of today's air transport systems. The growth of certain economic sectors has increased the need for air transport infrastructure to connect workers with jobs and to facilitate the transportation of goods throughout the country, especially to communities that may otherwise have no alternate means of transportation.
Over the last several years, Transport Canada has heard from provinces, municipalities and Canadians concerning an increasing number of complex issues related to the construction of new aerodromes and the operation of existing aerodromes.
As it stands, current regulations do not require aerodrome proponents to take part in consultation processes with local land-use authorities and affected communities, or necessarily notify Transport Canada or NAV CANADA prior to developing an aerodrome. Further, Transport Canada does not have a formal engagement process in place for stakeholders to raise concerns regarding aerodrome development to the department. In the absence of these tools, the department has been left in a reactive position, dealing with issues on an ad hoc basis, which has proven to be inefficient and resource intensive, and has not effectively responded to the concerns of your constituents. It has also led to unnecessary and significant costs to the aerodrome proponent. The goal is not to limit the freedom to fly but, rather, to provide greater regulatory predictability and more effective tools to promote safe flying.
An amendment to the Aeronautics Act is proposed to provide the minister with the authority to make an order prohibiting the development or expansion or any change to the operation of an aerodrome if there is a risk to aviation safety or if it is not in the public interest. This would include a case where a new or existing aerodrome is creating air traffic congestion. The proposed amendment will also provide for regulation-making authority respecting the consultations to be carried out by the proponent of an aerodrome before development or the operator of an aerodrome before an expansion or change to its operations.
This initiative will provide the minister with flexibility to effectively respond to existing and possible unforeseen issues or trends, and it is an important first step in modernizing the department's aerodrome framework. This amendment will also protect aerodrome proponents and operators from unnecessary costs associated with development and provide an opportunity for affected Canadians to be engaged in the process.
Joyce Henry, Director General, Marine Policy, Transport Canada: I'm pleased to be here today to have the opportunity to elaborate on those provisions proposed in Bill C-43 that pertain to the Canada Marine Act, specifically Division 16, clauses 228 to 231.
The proposed amendments to the Canada Marine Act have two key objectives. First, the proposed amendments under clause 228 will allow Canada Port Authorities the ability to acquire federal real property in their own name. This amendment supports the divestiture of regional ports by the federal government. To date, Transport Canada has divested or otherwise transferred 180 regional and local ports, with 50 remaining under Transport Canada ownership. Some Canada Port Authorities have expressed an interest in acquiring Transport Canada-owned ports to expand their business opportunities. Canada Port Authorities are well positioned to attract investments, increase traffic and create jobs at these regional ports. The divestiture of these regional ports to Canada Port Authorities could also help to ensure the long-term viability of the divested ports, given Canada Port Authorities' expertise in port management.
However, provisions under the current Canada Marine Act do not allow Canada Port Authorities the ability to acquire federal real property, thereby preventing Canada Port Authorities from participating in the divestiture program. The proposed amendments will support the successful divesture of regional federally owned ports and allow Canada Port Authorities the ability to acquire any surplus federal real property for sale.
Second, the proposed amendments to the Canada Marine Act under clauses 229 to 231 provide the government with an option to develop regulations applying to any specific large-scale commercial or industrial projects on federal port lands. These proposed amendments will also permit these regulations to incorporate by reference any laws or documents to effectively regulate any potential projects on federal port lands.
The main driver for these proposed amendments to the Canada Marine Act are the two proposed liquefied natural gas facilities that would be located on federal port lands managed by the Prince Rupert Port Authority.
Currently there's no federal regulatory regime in place to adequately regulate liquefied natural gas facilities on federal lands. Under British Columbia law, the British Columbia Oil and Gas Commission is authorized to regulate liquefied natural gas facilities in the province. However, constitutionally, British Columbia laws that purport to regulate the use and development of land would not apply to federal port lands.
The most efficient approach to achieve regulatory oversight for any new liquefied natural gas facility in British Columbia would be to have it regulated by the British Columbia Oil and Gas Commission. To allow for this and create legal certainly, it is proposed that federal regulations be made pursuant to the Canada Marine Act that would incorporate by reference the British Columbia provincial regime.
Currently, under the Canada Marine Act, the Governor-in-Council has the power to make regulations applicable to Canada Port Authorities, but presently it is insufficient to allow incorporation by reference of provincial legislation. Under the new federal regulation, the British Columbia Oil and Gas Commission would administer and enforce these federal regulations on behalf of Canada.
We are modelling our legislative approach on the proposed Haisla liquefied natural gas facility, where provincial legislation was incorporated into regulations made under the First Nations Commercial and Industrial Development Act, allowing the British Columbia Oil and Gas Commission to enforce and administer regulatory oversight. It is a similar situation except the lands in question are federal port lands and not reserve lands.
Canada Port Authorities are considered key economic drivers and vital to Canada's domestic and international trade objectives. There's a growing trend of increased project development on federal port lands. Accordingly, our intent in proposing these amendments is to ensure that, as projects proceed, they do so in a safe manner, protecting the environment and Canadians.
April Nakatsu, Director General, Crown Corporation Governance, Transport Canada: My name is April Nakatsu, Director General for Crown Corporation Governance at Transport Canada. I'm here to speak on provisions included in Part 4, Division 21 of Bill C-43. This division relates to the reorganization of certain Crown corporations in the Minister of Transport's portfolio that own and operate international bridges.
Authority for this reorganization was provided for in Economic Action Plan 2013 Act, No. 2. More specifically, the act provided authority for The Federal Bridge Corporation Limited to amalgamate with its two subsidiaries — The Seaway International Bridge Corporation and the St. Mary's River Bridge Company — and another parent Crown corporation, the Blue Water Bridge Authority. In addition to authorizing the restructuring of these bridge corporations, the act also provided that the resulting amalgamated entity would have the necessary powers and authorities required to operate, including the power to borrow and charge tolls.
In the course of preparing for the amalgamation, it has become apparent that it is not possible for the amalgamation of all four corporations to occur at the same time. Therefore, this division seeks to make technical amendments to the definition of "amalgamated corporation" in the Economic Action Plan 2013 Act, No. 2.
However, it is not a single definition of "amalgamated corporation" that is changing. Other related clauses are also being amended to have the definition take effect.
The legislative amendments contained in Part 4, Division 21 of Bill C-43, if passed, would ensure that each interim amalgamated corporation will have the required authorities to continue to operate the international bridges during each step of the amalgamation process. This includes section 262, which provides for key Blue Water Bridge Authority powers and authorities under its existing legislation to continue to have effect after it continues under the Canada Business Corporations Act. Normally, under the Canada Business Corporations Act, as at the date of the Blue Water Bridge Authority's continuance, the Blue Water Bridge Authority Act would cease to have effect. These powers and authorities are transitional only and will remain in place until it amalgamates with the other bridge corporations.
Collectively, these corporations operate or oversee the Canadian portions of four international bridges crossing the waterways between the province of Ontario and the states of New York and Michigan. The resulting amalgamated corporation will enable the application of consistent policies and procedures across all its operations, more streamlined reporting, the sharing of best practices, consistency in service levels and security protocols, and more rigorous financial planning. The technical amendments contained in Part 4, Division 21 of Bill C-43 are aimed at ensuring that the necessary authorities are in place at every step of the amalgamation process.
The Deputy Chair: Does anybody else have any comments for the panel? We will start with Senator Verner.
[Translation]
Senator Verner: I am a senator from Quebec, and I live in the Quebec City region. I would like to discuss the Neuville aerodrome, in particular, something we have heard a great deal about, and another matter that has also received some attention: the Quebec port.
First, I will address Mr. Roussel about the new provisions for aerodromes.
Because it was not clear, we had the impression that there was a double standard approach, in the case of both the Neuville aerodrome and the Parkland County aerodrome. The Minister of Transport at the time, Denis Lebel, did not intervene in the Neuville matter, while in the case of the Parkland County aerodrome, Minister Raitt, who succeeded him, requested public consultations.
I presume that this is the reason for the amendments in Bill C-43, to specify that, among other things, local authorities or the general public be consulted. Have I understood the matter correctly?
Mr. Roussel: I could not speculate on the thoughts of the ministers of Finance. You mentioned two specific cases, Neuville and Parkland County. There are others elsewhere in Canada, including Chatham, and before the Federal Court. We want to rectify all these elements and provide the tools needed to ensure that the communities and local authorities of these aerodromes can better plan the development of their aerodrome and everything around it, including the installation of wind turbines, which can cause problems in certain places.
On the Pacific west coast, for example, conifer growth is a problem, and the authorities are reluctant to make the necessary adjustments.
We have a number of similar cases across the country.
Senator Verner: Supposing there is a planning or expansion project for an aerodrome that complies with federal regulations, but violates provincial legislation or municipal regulations in terms of land-use planning — or in Quebec's case, protecting agricultural land — what criteria would allow you to recommend a decision to the minister? In other words, could you reject this project automatically and order the developer or operator to start again?
Mr. Roussel: There are three elements tied to public interest: social elements and their impact on local residents; the environmental impacts, positive or negative; and the economic impacts of airport services overall. Those are all the elements that are involved in the decision, and so each case is different. However, it is also important to see how the provinces and municipalities can participate in these discussions.
Senator Verner: So this is done based on the process put in place by Minister Raitt for the Parkland County airport?
Mr. Roussel: Yes.
Senator Verner: With respect to federal ports, Division 16 states that the Department of Transport could conclude an agreement with a provincial government to delegate the enforcement of its own legislation on federal port land.
To give you a recent example, there was a whole saga involving the Quebec port that had to do with the erection of grain silos. The port authorities decided to go ahead with Arrimage Québec because they claimed that they had exclusive jurisdiction from the federal government to do so, even though the Quebec government spoke out against it. Obviously, there was a local outcry, including from the mayor, who is well known.
Would that mean that, by concluding agreements with the government of one province, the provincial government in question could invalidate a decision on the grounds that it has the federal authority to do so?
Mr. Roussel: I am not in a position to answer that question.
Senator Verner: The woman who spoke about ports could answer.
[English]
Ms. Henry: I just want to clarify that the provisions under section 16 do two things. One is that they allow a port to acquire federal real property and, in this case, that's in support of Transport Canada's divestiture program for ports. It doesn't apply in the case that you mentioned.
In the second instance, which I think is probably a bit more germane, what we're doing is working with the province of British Columbia, in particular, at this point, to potentially incorporate their documents or laws or regulations on liquefied natural gas. The reason for that is that there's a gap in the regulatory regime because it's a new export project that's coming to the fore and B.C.'s at the forefront of that. So, it's a little bit of a different case than what occurred at the Quebec port.
Senator Verner: Are you aware of that case?
Ms. Henry: Yes. Tamara, I don't know if you want to add anything else, but, to me, they're very separate. What's happening in these proposed amendments doesn't relate to the case with the silos, the grain elevators.
Tamara Rudge, Director, Port Policy, Transport Canada: Yes, I think that's the case. The silos are normal port business. There's nothing there that would be a regulatory gap at this point. I know Quebec and the port we're talking about and some of the issues. There was kind of an outcry from the community about the look of the new silos. Those kinds of things are normal port business. This is really something where we would be incorporating a provincial regime where there's a gap and this is specific, in this case, to this facility. It would be kind of on a case-by-case basis and if a province came to us and wanted to work on something where they think there is truly a gap.
[Translation]
Senator Verner: If I understand correctly, in the specific case of the Quebec port and the incident with the grain silos, the port authority worked within its own jurisdiction, and Division 16 is not intended to give the Quebec government the authority of the federal government. In terms of this file, everything was very clear.
[English]
Ms. Henry: Right. Under the Canada Marine Act, port authorities are responsible for administering and operating their own lands, including decisions, in that case, with the grain silos.
Senator Merchant: Good morning to all of you. Just a few questions about the aerodromes: Can you give us a bit of a breakdown as to what kinds of things aerodromes are? Are they big airports? Are they small, rural? Just give us a bit of an overview of what you are going to be dealing with.
Shari Currie, Acting Director General, Civil Aviation, Transport Canada: An aerodrome is defined as any area of land, water or other supporting surface used, designed, prepared, equipped or set apart for the use, in whole or in part, of the arrival, departure, movement or servicing of aircraft, including any buildings, installations and equipment situated thereon or associated herewith. That's the official definition. That would apply to any site where a plane will take off or land on land or on water. It would be the small fields and the larger, built-up airports like Pearson. It would include all of them.
Senator Merchant: Thank you. Currently, who manages the aerodromes, some of the very small ones? Are they all registered? Do you need to register them? How do you go about it?
Ms. Currie: There are approximately 2,000 registered aerodromes across Canada and about 5,000 non-registered aerodromes that we're aware of. Then, there are approximately 300 certified aerodromes. The aerodromes that are certified are aerodromes that have applied to Transport Canada for certification because they have scheduled service. It's not mandatory to register with the department, which is why there are so many unregistered aerodromes.
Senator Merchant: Will this legislation make changes to any of the things you have talked about?
Ms. Currie: In consultation with industry, over the last 11 months, we've talked about putting in a requirement for any non-registered aerodrome to have to consult if they are going to change or expand their operations, or if they're going to establish a new aerodrome. The hope is that this regulatory requirement and this legislative change would push aerodromes to register so that both Transport Canada and NAV CANADA, and also the flying public, would be aware of where all of the aerodromes are across Canada.
Senator Merchant: What has been the genesis, then, of bringing in this amendment? Who has been asking for these changes?
Ms. Currie: The department has had a number of cases brought to its attention over the last few years that have ended up in litigation, where the aerodromes have been in court with either a municipality or members of the public. This has been brought forward to attempt to make the involvement of the department more predictive. So an aerodrome proponent would have specific criteria that they would have to follow in terms of notifying the affected communities, notifying Transport Canada and NAV CANADA, and responding within a very specific time frame to those concerns. Where a substantiated concern was raised that could not be resolved between the proponent and the person opposing the development, Transport Canada could step in in a formal way. So, it's very predictable for the proponent. They would know who they would need to speak to, the level of consultation required under the legislation and the regulations, and what our powers would be in terms of engagement. It's to try to move from a very ad hoc, reactive involvement in these cases to having set procedures so that all aerodrome proponents would be treated fairly and all affected communities would be treated fairly.
Senator Merchant: Just one last question: Are local municipalities and the provincial governments affected in any way, in their regulations or their role?
Ms. Currie: The federal government's jurisdiction over aeronautics is primary in terms of the establishment of an aerodrome. This amendment would put in place formal consultation mechanisms with the provincial and municipal governments.
The Deputy Chair: I believe Senator Unger has a supplementary question.
Senator Unger: Yes, I do. Thank you, chair.
My question is for Ms. Currie. I'm from Edmonton. We had a municipal airport in the middle of the city, and the city was talking about closing it. People were very opposed, including me, because we felt we had something that was a gateway to the North, for example. So, the citizens collected 1,200 or 1,400 signatures, which the mayor selectively chose to ignore. Had this change been in place, could people then have appealed to the government for intervention?
Ms. Currie: Once the minister's authority is in place and the regulations are in place, the department would have the ability to engage where there was a substantiated and fact-based problem brought to the department. I can't comment on a specific case, but if the aerodrome proponent or the affected community brought a fact-based case to the department, then we would review it and we would make a recommendation to the minister whether to intervene in that particular case.
Senator Plett: I have just one final little question in relation to what Senator Merchant was asking. If I have a small Cessna 150 airplane and I have a piece of land somewhere and I put up a windsock and I land this on my piece of land, is my land an unregistered aerodrome?
Ms. Currie: Where you're taking off and landing would be considered an aerodrome and, if you have not registered it with the department, it would be considered unregistered.
Senator Plett: Will this regulation require me to register that?
Ms. Currie: It will not require registration. We would hope that aerodromes would register so that we would know where they were and the flying public would know where they were in case they had an emergency and needed to land.
Senator Plett: Thank you.
Ms. Henry, you've explained it, I think, maybe as clearly as you can explain it. I still don't understand it, though.
With the liquefied gas situation in British Columbia, under this legislation, are we going to be competing with regulations with provinces? B.C., obviously, is regulating this liquefied gas situation now, so they have regulations. With these amendments, are we going to be bringing in regulations that are different than B.C.'s, and could we get into a battle with provinces over whose regulations take precedence?
Ms. Henry: The amendments that we are proposing here are to avoid that situation, because currently B.C. regulations apply on provincial land; they don't apply on federal port land because it is federal. We have been working with the Province of B.C., and we need these amendments in order to allow the B.C. regime to apply on federal port land. What you would end up with is a seamless regulatory regime for the province of British Columbia so that we don't have competing regulations.
Senator Plett: And they would be enforcing on our behalf? They would be enforcing our regulations?
Ms. Henry: That's right. They would be enforcing on port land, as well, through their B.C. Oil and Gas Commission, which has a significant amount of experience already in terms of these large-scale projects.
Senator Plett: Obviously, something like liquified natural gas, many people would consider this quite sensitive and there could be dangers involved. Would we negotiate with provinces as to what regulations we would want them to police? Even though this may be federal land — so we have a piece of federal land in a port with provincial land all around it — whatever dangers there would be on this federal land would obviously apply to all the residents and all the people outside that. Would we collaborate with the provinces before we would establish regulations?
Ms. Henry: Yes, we would. B.C. has a regime in place and they have a commission that they've already set up; and there is the Haisla example as well, so this is already entrain.
But with respect to working with the Province of B.C., not only would we work closely with them, but, in addition, the regulations would still go through the full federal regulatory process. They would still go through Canada Gazette Part 1. There would still be an opportunity for people to comment before they get to Canada Gazette Part 2. The normal process applies.
The Deputy Chair: As chair, I'll exercise my privilege to ask a couple of questions.
You mentioned, Ms. Currie, that there are 5,000 unregistered aerodromes in Canada that we know of, and I'm quoting you. There are 2,000, I believe you said, that are registered. Can you elaborate on what is Transport Canada's system currently to perform surveillance and inspect these aerodromes, et cetera? Do we have a process to determine if there are aerodromes above and beyond the 5,000 that are not registered? It's a little bit disconcerting to think that we can set up these mini landing strips anywhere in the country to be used for all kinds of activity, especially some activity that would be very dangerous.
Mr. Roussel: Thank you, Mr. Chair. I think that is not what this amendment does. However, the ones that are registered, of course the larger ones — the 306 certified ones that have multiple passengers using them — have an entire suite of regulatory regime on them and public passengers are protected.
The 2,000 registered aerodromes have a minimal regulatory regime that applies, depending on their class. The larger aerodromes that we know are Class 1, and that goes down depending on the number of passengers, the size of the airstrip and so forth. It's a regulatory question that you're asking.
The ones that are non-registered are privately owned and the regime is extremely minimal for them.
The Deputy Chair: So we wouldn't perform surveillance or inspect them at all over a period of a year or two?
Mr. Roussel: We don't have a regime on that for the non-registered aerodromes.
The Deputy Chair: The second question I have is with regard to the element of the bill which talks about the need for public consultation before we attribute them or register them. Can you elaborate on what would be the process of the public consultation?
Ms. Currie: We're just beginning the discussions with industry in terms of what those requirements would be, because currently we don't have the rule-making authority to move forward with that regime and that is why we're seeking this act amendment.
What has been discussed with industry over the last 10 or 11 months is a 30-day consultation period. The aerodrome proponent would need to notify Transport Canada and NAV CANADA that they were intending to begin development. They would need to notify the community within a specific range — we've talked about between 20 and 30 nautical miles — and then they would only need to respond to those affected communities that were within that specific range or whatever specific range we come to agreement on in our focus groups in our consultations.
Where there is an issue that cannot be resolved between the proponent of the aerodrome and the affected community, then one or the other could bring that concern to Transport Canada, which is where we would engage. It would be a very phased, stepped process in terms of engaging the department, and we would have a set period of time to respond and to engage in that discussion with the aerodrome proponent or the affected communities.
The Deputy Chair: I assume when we begin that process, we will also make a list of what we define to be in the public interest.
Ms. Currie: We expect that the definition of "public interest" will be similar to what's in the Aeronautics Act now or what's in federal jurisdiction. My ADM spoke to some of these criteria that we look at, but when the department is considering public interest, it has to consider both sides of that discussion. It has to consider the interest of the aerodrome proponent, whether the airport is economically viable and whether it's in their interest, but it also needs to consider whether it's in that affected community's interest, so the more social issues and access issues that were brought up. We have to look at both sides in terms of public interest, so the definition will remain very broad but within the jurisdiction the Aeronautics Act.
Senator Demers: I apologize for my voice; it's not my regular voice.
Hopefully, this question won't be out of line. I live close to an airport in Quebec, the airport in St-Lazare. We have had in the last year all kinds of incidents with smaller airports to do with the security of people. A young pilot who was learning how to fly flew into one of the houses with a pool and fortunately no one got killed .
What protection do we have where you just put in an airport in areas where people work and live? Do we have protection for that?
I'm sorry; I hope my question came out well.
[Translation]
Mr. Roussel: In response to a previous question, I would like to say that, in terms of the regulatory regime of each certified airport — registered or not — it would be useful for the committee to receive some more information about the regulatory regime for each type of aerodrome.
[English]
Senator Greene: I just want to clarify that the definition of "aerodrome" only consists of a manned aircraft. I'm thinking of drones. We're entering an era where drones will be used more and more, for all kinds of reasons that we can't contemplate. I would imagine, if somebody was going to begin a business around drones and have some land and buildings associated with them, that would not be an aerodrome of any kind, registered or unregistered.
Mr. Roussel: The departure area of any of those UAVs would be considered an aerodrome.
Senator Greene: It would be considered an aerodrome?
Mr. Roussel: Yes.
Senator Greene: So, for a company like Google or Amazon, which has indicated already that it wants to use drones to deliver packages, their landing and takeoff area would be considered an aerodrome?
Mr. Roussel: That's our understanding.
Senator Greene: That's very interesting.
Ms. Currie: I will just add a bit more information on that. In the Canadian Aviation Regulations, CARs, we don't make a distinction between manned and unmanned airplanes. If you look at the CARs, the unmanned air vehicles are considered aircraft. They're using the airspace. In terms of those temporary takeoffs and landings, there are provisions in CARs, right now, where there are not the same type of requirements in place in terms of a registered or a certified aerodrome.
If you look at emergency MEDIVAC, when they fly in, or if a logger flies in and takes down five trees, these aren't established aerodromes. They're minute, they're instant, and then they're gone. There are different ways to treat the types of aerodromes in the aviation regulations.
So, yes, it would be considered an aerodrome under the definition, but there are different ways to be treated.
Senator Greene: In future, I would imagine that, if we kept to that regime, there would be thousands and thousands of aerodromes across the country as we move to that technology.
Ms. Currie: For the department, we need to consider the safety of the airspace in terms of what is and what is not an aerodrome and what rules apply to that aerodrome.
[Translation]
Senator Verner: I would like to come back to Division 16, with respect to the development of federal ports. I understand that the Minister of Transport will be able to transferring the administration of federal regional ports to Canadian port authorities. Are you able to confirm for me that these provisions correspond to measures in the 2014-15 budget, which set out investments of $33 million to do so? Is that correct?
Ms. Rudge: Yes.
Senator Verner: Could you provide some examples of Canadian port authorities that have shown an interest in acquiring regional ports, and why, specifically? Do you have any examples in mind?
[English]
Ms. Henry: I'll just begin by saying that, despite the proposal for amendments here that would allow Canada Port Authorities to potentially acquire Transport Canada-owned regional ports, there is a federal directive that states that there is a certain order of precedence, if I can put it that way, for divestiture discussion. It begins with federal agencies and Crown corporations. Next are provincial governments, then municipal governments, and only then, if none of those are interested in entering into negotiations with the department for divestiture, would Canada Port Authorities or other private entities or the public have an opportunity to acquire the port.
This is to allow Canada Port Authorities to potentially acquire a regionally owned port in support of the divestiture program, which I think is under section 33 of the budget bill. In terms of Canada Port Authorities themselves, it doesn't guarantee because they're not at the top of the list. They would be able to express their interest only if the others had first not expressed an interest.
In terms of specific Canada Port Authorities that have spoken to the department about potentially acquiring our ports, I'm not sure it's totally appropriate, at this point, to go into that just because the program itself is still being finalized.
Ms. Rudge: I can say that there were several that are interested. It's because they have finite amount of land now, and they have business opportunities. They look at some of the regional ports that are not that far away and maybe they could be running some of those businesses through those regional ports. Some of them have done a good job of maximizing their port in their particular jurisdiction and this is kind of like, "We want to expand. We think we have a good idea, and we think we could run that business through a different community."
[Translation]
The Deputy Chair: Since there are no other questions from the senators, I would like to thank the witnesses for being here.
[English]
Your presentation and your answers were very helpful, and we appreciate it.
Our next panel is composed of officials from Industry Canada and Canadian Heritage. We have, from Industry Canada, Lynne Fancy, Senior Director, Spectrum Management Operations; Amy Jensen, Policy Analyst, Spectrum Management Operations; and Adam Scott, Director, Business and Regulatory Analysis. From Canadian Heritage we have Helen C. Kennedy, Director General, Broadcasting and Digital Communications.
I'll invite the witnesses to make their presentations and then we'll have senators ask you questions if they wish. You have the floor.
Lynne Fancy, Senior Director, Spectrum Management Operations, Industry Canada: We'd like to thank you for this invitation to discuss the proposed amendments to the Radiocommunication Act. The Radiocommunication Act regulates radio frequency spectrum. This is a scarce and valuable resource and is a necessary component in all wireless communication services used by Canadians.
The proposed amendments will strengthen Industry Canada's existing compliance tool kit by introducing new tools. These amendments will reflect the reality that spectrum is being used in new and innovative ways through the provision of enforcement tools that are flexible and efficient and that focus on encouraging compliance.
As we continue to rely more on the use of wireless devices, there is a growing demand for access to spectrum, and this scarce resource is becoming more valuable. Along with an increase in the number of wireless devices being used, we no longer simply use these devices to talk and text, but they are also being used more and more by Canadians to access a wide variety of applications on smartphones, all of which rely on the availability of wireless spectrum.
With the increased proliferation of wireless devices and the creation of new wireless technologies, the wireless sector is occupying an increasingly important role within the Canadian economy and society. The wireless sector has developed into a growing source of jobs, and it plays a key role in the continuing success of businesses and communities across Canada. Wireless communications is a key tool for first responders, police, fire and ambulance.
Industry Canada has licensing processes in place that assist the department with the management of spectrum through the assignment of terms and conditions on users. Industry Canada also regulates radio equipment in order to ensure that it meets standards and is safe for Canadians.
The current act provides a number of enforcement mechanisms that range on one end from education to, on the other end of the continuum, licence revocation. These tools are used by Industry Canada to ensure that the requirements of its licences are met, but in order for Canadians to maximize the value associated with the spectrum resource, it's important that these provisions, which have not been updated in 25 years, be modernized to keep up with the changing spectrum regulatory environment.
Of significant note, the amendments will introduce an administrative monetary penalty system, or AMPS regime, for certain violations of the act. AMPS will not replace the existing enforcement measures that are applicable under the act, yet they provide another tool, somewhere between education and licence revocation, to empower the department to apply the most suitable measure in the case of non-compliance.
The proposed AMPS regime described in clause 182 will provide for penalties to corporations of up to $10 million for an initial violation and $15 million for subsequent violations. These thresholds are consistent with penalties available to the Competition Bureau and the CRTC in connection with Canada's anti-spam legislation, and they are also the same as those proposed with respect to the Telecommunications Act that we will be hearing about next.
For individuals, such as somebody who would be using a jammer near an airport, the amounts are much smaller in order to reflect the differences between individuals and larger entities. Penalties of up to $25,000 for a first violation and $50,000 for a subsequent violation can be levied against individuals. The dollar value of any penalty, though, assessed against a corporation will be determined by taking into account the scope, the nature of the violation and the size of the violator.
There are also a number of additional measures included in these amendments that will improve the overall effectiveness of the compliance regime. The amendments in clauses 174, 175 and 181 will explicitly prohibit jammers. These are devices that disrupt legitimate wireless communications. Some exemptions to the prohibition may be made for reasons such as public safety. The amendments in clauses 176 and 180 will also allow Industry Canada to enforce any requirements established for spectrum auctions.
Additional amendments in clauses 178, 179 and 180 are designed to modernize dated language concerning inspector powers and allow inspectors to collect information from computers and other similar devices instead of just from paper products.
Furthermore, the amendments in clause 177 will allow Industry Canada to share information with domestic and international agencies to assist with the effective regulation of radiocommunications. For example, if we were trying to stop the importation of jammers, we would benefit from sharing information with the U.S. border authorities, but this information would only be shared within strict boundaries with respect to the use of the information and its confidential treatment.
Thank you very much for your time, and we would be pleased to answer any questions.
The Deputy Chair: Is there anybody else on the panel who would like to make a comment? Mr. Scott.
Adam Scott, Director, Business and Regulatory Analysis, Industry Canada: Good morning. It's my pleasure to be here today to explain Division 11 of Part 4 of the budget implementation act concerning amendments to the Telecommunications Act, as well as a related amendment to the Broadcasting Act, and to answer your questions.
First I would note that this section of the bill supports commitments made under the government's Consumers First agenda to support and protect Canadian consumers. I have a number of amendments to get through, and I'll tackle them in the order in which they appear in the bill.
The first deals with pay-to-pay policies, also known as paper billing fees, which are addressed at clauses 191 to 194. This is a direct response to the government's commitment to end pay-to-pay made in the 2013 Speech from the Throne and Budget 2014.
The amendment to the Telecommunications Act prohibits telecommunications service providers from charging their customers for bills in paper form. A parallel amendment in the Broadcasting Act does the same for providers of broadcasting services. Together, these two amendments capture the full suite of services that customers are accustomed to getting from their communications service providers: telephone, wireless, Internet access and broadcasting.
The next amendment, at clause 193, allows the CRTC to impose conditions — such as access for persons with disabilities or access to emergency services — on providers of telecommunications services that are not carriers. Currently, the CRTC can impose these conditions directly only on companies that own their own networks, i.e., the telecom carriers. For providers that do not own their own networks — often referred to as resellers — the CRTC has only been able to impose conditions indirectly through contracts with carriers. An example of this type of reseller would be a white-label brand such as President's Choice Mobile.
The proposed amendment extends the CRTC's ability to set conditions directly on resellers so that consumers will benefit from the same safeguards, regardless of which type of service provider they choose.
The amendments at clause 195 allow for information sharing between the CRTC and the Commissioner of Competition to facilitate the presentation of more specific, evidence-based interventions by the commissioner before the CRTC. To be clear, we're talking here about sharing competitively sensitive information, not private information of Canadians.
Currently, the CRTC can release confidential information to the Minister of Industry and to the Chief Statistician, but cannot do so with the Commissioner of Competition. However, the CRTC is dealing with issues that are increasingly linked to competition and the competitiveness of communications markets. Allowing the CRTC to share information with the Commissioner of Competition would allow the commissioner to make more informed interventions, thereby fostering better decision-making. Information shared would remain confidential and can only be used in relation to matters before the CRTC.
The amendments at clauses 196 to 199 deal with certification of telecommunications apparatus. These amendments simplify and streamline the process for demonstrating that telecom apparatus meet technical requirements and provide the Minister of Industry with the authority to register apparatus for use in Canada.
The amendments at clause 200 update the language describing the CRTC's inspection abilities. These changes relate to the introduction of new compliance tools for the CRTC, administrative monetary penalties, or AMPS, which are covered under clauses 201 to 208. A key commitment under the government's consumer agenda, the AMPS amendments improve the CRTC's existing compliance tool kit by giving it the ability to impose penalties of up to $10 million for first violation for companies that do not comply with its decisions and regulations. For individuals, the amounts are much smaller, up to a maximum of $25,000 for a first violation.
In all cases, in determining the amount of the penalty, the CRTC will need to take into account a list of factors stipulated in the legislation, including the nature and scope of the violation, the ability to pay and the benefit derived from the violation, so that penalties are appropriate.
The last amendment, at clause 210, deals with the coming into force of the amendments relating to the telecom apparatus registration system to give sufficient time to communicate with the industry and make follow-on changes to regulations and procedures. Taken together, this is a comprehensive package of measures that responds to government commitments to support Canadian consumers.
Senator Plett: Thank you. Ms. Fancy, you talked about fairly significant penalties, as did Mr. Scott. First of all, let me ask this question: What's a jammer?
Ms. Fancy: It's a device. It could be a small device. It jams wireless communications. It stops communications from happening.
Senator Plett: So, if an airplane is on its final approach and somebody would jam communication there, you say for an individual the fine is $25,000.
He's putting a whole lot of lives at risk. It seems like a small penalty if somebody would do something that would clearly put a lot of people at risk.
Are there other penalties that could be added to that? You mentioned the large ones of $5 million and $15 million fines? What are the penalties now? You're talking about huge penalties. What are the penalties presently?
Ms. Fancy: Currently we do not have an AMPS regime in place at all, so in terms of a monetary penalty, we do not have that in our tool kit. Primarily, the tools would range from education all the way through to sort of a licence revocation. There are also offence penalties. Perhaps I will ask Amy to explore that.
Amy Jensen, Policy Analyst, Spectrum Management Operations, Industry Canada: Sure. Thank you. With respect to the jammer, for the individual, we would have the choice of imposing that administrative monetary penalty, but we would also have the option of pursuing a regulatory offence where we prosecute them and, upon summary conviction, that is punishable by up to a year in prison.
Senator Plett: Thank you. Is that possibility there now, or is that also not there now?
Ms. Jensen: There is an offence provision right now in the act. What we've done here, though, is clarified what could lead to that offence provision. Right now, it is an offence to have stuff or use stuff under circumstances where we think it would be interfering, but you have to prove that intent. Under the new provisions, these are very clearly prohibited and are simply not allowed.
Senator Plett: A jammer, is that a device that I could go and purchase, something that would allow me to do something like you're suggesting? Can I just go and purchase that?
Ms. Fancy: Yes. They're not legal devices to purchase, but there are people who manufacture them.
Senator Plett: They're not legal devices to purchase. Okay. Thank you.
Ms. Fancy: This is making it very clear that you cannot use these devices. Typically jammers are primarily used in a criminal context.
Senator Plett: Thank you. Mr. Scott, the same question about what are penalties now. The penalties you were talking about, are there any penalties now?
Mr. Scott: Sure. In our case, we're talking about the CRTC as the regulator, and they do have some specific AMPS penalties for small portions of the regulatory framework. For example, with the National Do Not Call List, which pertains to telemarketing, they can issue an AMP of up to $15,000. It's a different type of offence, hence the difference in the nature of the AMP. With the anti-spam legislation that was recently introduced, there's an AMP of up to $10 million.
If you're talking about the broadly applicable penalties, the act does have an offence provision, but that requires pursuit of a prosecution through the office of public prosecutions. It's a fairly time-intensive, burdensome process in contrast with the AMP, which is much more efficient.
Senator Plett: Thank you.
Senator Merchant: Thank you for your presentations.
Regarding the AMPS, are there other jurisdictions where they have used this as a means of getting compliance? Can you elaborate a little bit on how that works, and are the amounts of the penalties similar?
Ms. Fancy: Definitely there are other regimes that use the AMPS regime. The U.K. and Australia both do. In terms of the amounts, I am not familiar with that.
Ms. Jensen: I don't think the amounts are quite the same, but, unfortunately, I don't have that right off the top of my head.
Senator Merchant: How long have they been using AMPS as a means of getting compliance? Is this something new that people or the countries are trying?
Ms. Jensen: I know Australia has had them in since at least the 2000s, somewhere in that decade, but the U.K., I'm not sure.
Ms. Fancy: Sorry. No.
Senator Merchant: We do have some models of other jurisdictions that have used them.
Ms. Jensen: Yes.
Senator Merchant: Mr. Scott, you mentioned the Do Not Call List. Has that worked? I remember the fuss we made over that, and I have heard from all kinds of people that it hasn't worked. I'm wondering how we are going to make this new stuff that we're introducing work.
Mr. Scott: I would say there are elements of it that have worked well. The nature of the problem is so vast in scope and expectations of Canadians are appropriately high. I think some of the complaints that we continue to hear specifically pertain to international problems or explicitly fraudulent activity, including companies that are disguising their numbers so that you don't have that easy way of identifying who's committing the violation. That's a particular challenge and I know the CRTC is very active in that space, working with their colleagues internationally and working specifically on technical solutions to the issue of number spoofing or the disguising of numbers.
Those challenges remain, but millions of Canadians have signed up for the list. The CRTC has imposed AMPS on a number of companies, so in that sense I would say yes, it has been successful.
Senator Merchant: There are complaints from Canadians that they have put their names on the list and they are still receiving calls. I've heard that.
Knowing the downside, the downfalls of that legislation, are there other things you are anticipating through this legislation that you might not be able to manage?
Mr. Scott: I would point out here that the nature of the violations and the nature of the companies that are being addressed are different. With the telemarketing rules, it's a vast array of companies that are active in this space. On the telecommunications side, these are companies that we see and deal with routinely. When they're Canadian carriers, they are some of the largest publicly held companies in Canada. They have a strong incentive to comply. They have a long history of compliance with the CRTC, so it's not quite the same context as we've seen with the Do Not Call List. I would expect this to go quite well.
The Deputy Chair: Senator Unger, you have a supplementary question to Senator Merchant's question?
Senator Unger: Yes, I do.
Regarding the Do Not Call List, I never got nearly as many calls as I did after I registered with that. It's just unbelievable.
Senator Plett: You checked the wrong box.
Senator Unger: I guess so.
I'm wondering how on earth you will ever get that back. How will those people ever be forced to stop calling me? To my astonishment, they start showing up on my BlackBerry and I've also been getting texts. I don't know if that all comes under the same jurisdiction, but to me it's still a huge problem — and spamming, that's just a given almost.
Mr. Scott: On the question of enforcement, that's really a matter for the CRTC and I can only speak in a limited capacity there. The CRTC would be the best place to answer those types of questions.
Senator Unger: Thank you.
[Translation]
Senator Verner: I have a question about jammers. I live in the greater Quebec City area. A few years ago, there was an article in La Presse about the first major seizure of jammers in Canadian history, which took place in the Quebec City area. The RCMP seized 66 jammers.
Under the provisions of the act, based on what you just explained, the Criminal Code already prohibits the use of these devices. Complementary provisions will be included, specifically in the Radiocommunication Act, in relation to what is already prohibited under the Criminal Code.
That is a lot of devices. We are talking about 66 jammers. What area of activity is this? I understand that you just answered Senator Plett's question about criminal activities, but what exactly is involved?
It seems to me that you would not get a device like this just to be mean-spirited with neighbours who talk to each other. I imagine that it is used particularly in the underworld, by drug dealers and the criminal element.
[English]
Ms. Fancy: Jammers can come in all shapes and sizes and for different purposes. For example, a truck driver who runs a truck for his company may use a jammer so that his employer can't find out that he's taken a little extra detour, for example, because there are GPS units on cars that can be tracked. A jammer could interfere with that communication. It's not only criminal activity; there can be other uses for it. It's something that would interfere with your rightful communication. You don't want that to happen in cases. You want to be able to use your cellphone and all of the other applications. It's so important in Canada. It's not just your cellphone. Coke machines these days are talking wirelessly, but there are many different applications. There are reasons for criminal provisions, and there are reasons for having it within the Radiocommunication Act.
[Translation]
Senator Verner: Can you tell us to what extent jammers have been used in Canada in recent years? I assume that this is a growing problem, since the Radiocommunication Act is being amended. The seizure in the Quebec City area dates back to 2009, which is already five, almost six years ago. Is this a growing phenomenon?
[English]
Ms. Fancy: No. There's steady use of jammers. There are always examples, every year, of a seizure or jammers that we need to take, but the importance of wireless is increasing. Therefore, the consequences and the impact that jammers can have in the environment is much more significant than it used to be and, therefore, it's important that we have more in our tool kit to be able to address these. It's a very clear prohibition — thou shalt not have these devices — in addition to an AMPS regime whereby if you do, not only can I take your device, but I can also make sure that you understand that it was not permitted.
[Translation]
Senator Verner: Moving on to another topic, I would like to talk about fees for receiving paper bills. I understand that the government had made a commitment not to have consumers charged for paper bills from broadcasting and telecommunications companies. I understand that this is a fine and noble thing for the consumers. But how can we make sure that the companies in question will not find another way to pass these costs off on to consumers?
This may not be the best example, but when the government took action to oversee cellphone contracts, there were subsequent costs. When my young daughter wanted to switch devices, new charges suddenly appeared on her bill, even though her contract was consistent with what was enacted under the federal legislation.
Do we really have the tools to ensure that these charges do not trickle down to consumers in some other way?
[English]
Mr. Scott: We should be clear that the legislation itself is actually quite specific. It prohibits a very specific behaviour, which is the charging of a fee for a paper bill. It's not intended to address the broader issue of rate increases. There are two different scenarios that I think merit mentioning.
The first is in an area where the service prices are still regulated, so this would be your plain, old-fashioned telephone service in smaller communities that do not yet have competitors offering service. Their companies would not be able to increase the rate because that's a regulated rate, so we won't see that introduced through another channel there.
In the majority of markets, where companies do face competition, they will not be allowed to charge a fee based on your billing preference, but they could make a general business decision to increase their fees across the board. That's a business decision set by market forces. They may choose to do that, and their competitors may choose something else. Consumers will have that choice.
Senator Plett: I'm trying to get an education here on some of these devices. I finally learned how to use my BlackBerry, and I can turn my iPad on and off.
Getting back to the jammer, I've been told when I travel, as we've all been in certain countries, to be careful not to use my cellphone when I'm driving down the street because somebody sitting off to the side will be able to pick up my signal and steal my telephone number. Is that what a jammer would do?
Ms. Fancy: No. A jammer is the opposite. A jammer, by definition, is interfering with your communications. I haven't heard of a device — not to say that it doesn't exist — that actually hacks into your phone number.
Senator Plett: In Mexico, I've been told to be very careful to not use my cellphone on the street because somebody could actually tap into it.
Ms. Fancy: Jammers are typically devices that block. It wouldn't necessarily have to be just that. I am sure there are going to be creative developments over the years as wireless becomes —
Senator Plett: But none of this legislation is dealing with the situation that I just described?
Ms. Fancy: No.
Ms. Jensen: I note that if you had something that was grabbing signals like that, that would be a radio apparatus, so it would actually be already regulated under the act. We probably did not give that person a licence to do that, so they are already not allowed to do that.
Senator Plett: Fair enough. Thank you.
The Deputy Chair: I will share with Senator Plett a recent example I was given of a jammer, which is quite fascinating, when you think of it. The panel can correct me if I'm wrong.
The movie industry in Hollywood is having a lot of difficulty with their movies being pirated. The simplest way is for customers to go into a movie theatre, take their smartphone and record the movie. They'll distribute it, after that, by whatever means they want. The movie industry was talking about installing jammers in the movie theatres across North America to jam all waves that go in and out so that they can literally block all cellphones of the individuals in those theatres. That's an example of a jammer. That would be one.
Ms. Fancy: That would be a jammer, yes.
Senator Plett: That would be a jammer that somebody could get a licence to have?
Ms. Fancy: No, you cannot have a licence to operate a jammer.
Senator Plett: As to what the deputy chair is talking about, would that not be something that we would want to promote, though? To further the example, I bought one of those movies on the street one day in New York, and I watched the movie and was wondering why I saw these shadows walk in front. I told my boys this and they said, "What kind of a dummy are you for buying this movie?" But would that not something we would want to promote?
Ms. Fancy: What we want is to ensure that people who have a licence to use their devices, or are providing a service, are able to offer those services without interference. A jamming device, such as in this case, takes that option away from somebody to use their device. Using a jammer would be prohibited.
In the legislation, there is some very narrow possibility of an exemption with regard to public safety and public interest, but those would be the only cases where a jamming device —
Senator Plett: This would be public interest. It might not be public safety, but it would be in the public's interest not to allow somebody with an iPhone or whatever device to go into a movie theatre and pirate this movie and be selling it on the street or watching it at home. So would that be in this limited scope?
Ms. Fancy: An exception would have to be applied for, and public interest is more like public safety. It's broad public interest in terms of the President of the United States coming to Canada and wanting to use jammers to ensure that no cellphones around him can trigger a bomb, for example. It would be those areas of very narrow use of a jammer in some circumstances. In all other circumstances, jammers would be prohibited.
The Chair: Ms. Jensen, Ms. Fancy, Mr. Scott and Ms. Kennedy, thank you for your appearance here today. It's been very helpful in doing our work on the elements of Bill C-43.
I want to remind our members that we will be meeting again, on Wednesday of this week, at 6:45. There's a room change, so the meeting will be in room 9, just next door, and we'll be having before us the Canadian Airports Council and the Canadian Owners and Pilots Association.
Thank you. This meeting is adjourned.
(The committee adjourned.)