Supply Chain Fluidity
1. How would the measures contained in Bill C-33, Strengthening the Port System and Railway Safety in Canada Act, help Canadians and the supply chain?
1. Recent challenges have highlighted the importance of a strong and resilient supply chain. While supply chain challenges are multi-modal, the measures in Bill C-33 would be a first step in addressing ports and railways specific matters.
To better position ports today and into the future, they need modern tools to navigate increasingly complex operating environments, while also ensuring greater transparency and accountability.
Measures contained in Bill C-33 would improve fluidity of traffic flows at Canada’s ports and maximize efficiency, better manage traffic and congestion, and in turn would help reinforce the resiliency of the supply chain.
Railway measures would ensure an appropriate and up-to-date rail safety and security regime that would bring certainty to planning and decision-making for the rail industry and promote a more efficient and stronger supply chain.
2. The Government of Canada recognizes the importance of the recommendations from the Supply Chain Task Force. These external recommendations call for immediate and long-term actions that aim to improve the resiliency of Canada’s supply chains in the face of disruptions.
While the government has committed to longer term actions, such as the development of a National Supply Chain Strategy, this proposed legislation is a first step towards strengthening Canada’s supply chain.
Measures contained in the bill would help to establish a strong foundation that would build on the Task Force’s recommendations. Specifically, the proposed legislation is seeking to position ports as strategic enablers of trade and traffic given their central role as intermodal hubs that support supply chain performance and economic growth.
The proposed legislation would also modernize the framework needed to maintain a safe, secure, efficient, and reliable railway system that not only fosters economic growth, but also benefits all Canadians.
3. Given that supply chain challenges are multi-modal, why does Bill C-33 focus only on issues faced by the ports and rail sectors?
3. The marine, air, rail, and road modes of transportation are interdependent. A disruption in one link of the supply chain reverberates throughout the entire system.
An efficient and resilient supply chain that delivers reliable freight movements requires collaboration amongst all supply chain actors, coupled with the appropriate tools and levers that enable adaptation to an evolving operational landscape.
While the proposed legislation is an immediate step towards strengthening our supply chain in the marine and rail sectors, it is not all encompassing. Rather, it is recognized that further actions may be required for the road and air modes as Transport Canada works with its partners to develop a long-term National Supply Chain Strategy.
4. How does Bill C-33 support funding announced in Budget 2022, for Transport Canada?
4. Budget 2022 announced financial support for Transport Canada, including
$136.3 million over five years for industry-driven data solutions to make supply chains more efficient, and recpaitalize the National Trade Corridors Fund by $450 million.
In October 2022, the Government stated its intention to launch a new initiative for Advancing Industry-Driven Digitalization of Canada’s Supply Chain to improve the efficiency and resiliency of the supply chain through collaboration amongst actors across the transportation sector. This would form a key part of the National Supply Chain Strategy and would support data collecting and sharing, digital solutions, supply chain visibility and working with the industry with an aim to alleviate bottlenecks, ease congestion and better plan infrastructure investments.
The recapitalization of the National Trade Corridors Fund would support supply chain projects to ease the movement of goods across Canada’s transportation networks, brining its total to $4.6 billion over 11 years (2017-2028). Currently, this program has made investments of $740 million in 45 projects, to improve the fluidity, reliability, and overall performance of Canada Port Authorities from coast to coast.
Investment framework
5. What is Transport Canada’s proposed investment framework and what would it entail?
5. Private investment in ports has been key to the maintenance and developplement of their world class facilities and services.
Given the strategic role ports play as supply chain integrators, Transport Canada has developped an investment framework to provide clarity and predictability to investors so they are empowered to make informed and strategic investment decisions in alignment with Canada’s competition, national and economic security objectives.
The investment framework seeks to modernize and adapt investment reviews to ensure Canada’s most strategic ports continue to uphold their unique position as supply chain integrators, while remaining attractive to potential investors.
In support of this framework, Bill C-33 proposes the introduction of three key legislative provisions. The first would broaden the scope of investments transactions at ports that are eligible for review, to help ensure investments support measures of the public interest. The second provision would provide greater insights into port operations and activities through data and information sharing to support effective decision making and policy development. The third would safeguard the supply chain from significant threats by enabling the Minister of Transport to take swift, decisive action at ports when there are risks to ports or the fluidity of supply chains.
6. How would the new investment review process differ from the status quo?
6. Current reviews under the Canada Transportation Act assess transactions for alignment with the public interest through the lens of Canada’s transportation system. As such, they focus on impacts on users of the transportation system, communities, trade, gateways, and corridors.
National Security Reviews under the Investment Canada Act, by contrast, consider a transaction through a broader lens and assess factors including potential effects on Canada’s defence capabilities and interests, the security of critical infrastructure, and the potential to enable foreign surveillance or espionage.
Bill C-33 would not change these process, rather it proposes an administrative change to the Canada Transportation Act that would lower the financial-based investment review threshold for transportation undertakings situated at a port authority, from $93M to $10M, except where to do so would be in violation of Canada’s existing trade obligations.
If pressed: Canada will continue to honour its existing international trade commitments, therefore, this lowered threshold will not apply to investors from the European Union and the United Kingdom.
7. Data is key to understanding port operations and supporting informed decision making.
Recent events including climate related disruptions and the COVID-19 pandemic have revealed a gap in the government’s access to critical data to enable informed decision-making on policies and interventions to improve the resiliency of Canada’s supply chains. To close this gap, Bill C-33 would provide, through the establishment of a regulation-making authority, an improved line of sight into supply chains by the collection of information and data from Canada Port Authorities, terminal operators and other key port users.
Transport Canada will develop a robust data strategy in consultation with stakeholders to inform this important work. This would ensure the Department captures data and information that is meaningful and purposeful to decision-making, including on port operations, competition, or any other factors that underpin supply chain performance.
Traffic Management
8. As vessel traffic increases in Canada’s ports, safety and efficiency will be increasingly important.
Marine traffic management plans are a best practice in large ports around the world, support navigational safety and offer predictable and reliable supply chain performance.
The Port of Vancouver is actively developing an Active Vessel Traffic Management System that would optimize traffic flow through the port, including how anchorages are managed.
The proposed legislative changes would facilitate and promote this work by enabling ports to take a leading role in actively managing traffic, including anchorages to support supply chain performance.
Ministerial Order
9. What is the Ministerial Order authority, and under what circumstances would it be used?
9. The proposed Ministerial Order authority seeks to provide the Minister of Transport with a key tool to safeguard supply chains from a crisis, such as pandemics, cyberattacks, or domestic blockades.
A Ministerial Order would allow the Minister to take swift, decisive action in response to significant and immediate threats to the safety and security of workers, goods, ships, and facilitites at Port Authorities or to the security of Canada’s supply chains.
Advisory Committees
10. The importance of Canada Port Authorities has grown significantly since their initial incorporation over 20 years ago, including for local communities.
During consultations undertaken as part of the Port Modernization Review, Indigenous communities, municipalities and local communities expressed a desire for greater engagementwith CPAs on their overall activities.
As a result, Bill C-33 is proposing all Canada Port Authorities be required to establish a mechanisms to structure ongoing engagement with these groups.
These advisory committees would provide port management with regular input on a variety of port-community issues such as urban/port development, the environmental implications of port plans and operations, including relevant water-side operations such as anchorages.
Advisory committees are considered best practice at the international level as an effective mechanism to share information and input on port activities and development.
Environmental Measures
The measures proposed in Bill C-33 would seek to take action on risks from climate change, build climate resilience, and reduce pollution. These measures would support Canada’s ambitious commitments on climate change, including exceeding the Paris Climate target by achieving 40 to 45 per cent emission reductions by 2030 and getting to net-zero by 2050.
The proposed amendments to the Canada Marine Act would better integrate environmental considerations into port authority planning and decision-making and enhance transparency on environmental performance.
Bill C-33 also includes a regulatory authority that would enable Transport Canada to advance climate objectives, via regulations, including the ability to set specific greenhouse gas reduction target for ports.
Governance and Financial Management
12. Measures contained in Bill C-33 seek to better reflect the evolving context in which Canada Port Authorities serve as arms-length instruments of public policy and to reinforce good board governance through measures to improve composition, due diligence, transparency, and accountability.
Bill C-33 would enable well-functioning, diverse, and proficient boards by expanding eligibility, amending membership of some boards, and taking steps to strengthen strategic planning and decision-making for port operations.
Furthermore, Bill C-33 seeks to promote sound governance by establishing periodic reviews of governance practices and a regulatory authority to ensure management practices remain best in class. The proposed governance measures would increase port authorities' accountability and responsiveness to users, stakeholders and the Canadian public.
14. The day-today operations of Canada Port Authorities are directed by independent Boards of Directors, who are responsible for ensuring that port planning, decisions and operations are made in the public interest. In this context, and in accordance with the Canada Marine Act, the Minister of Transport is responsible for setting the strategic direction of the port system.
Recognizing effective board leadership is critical for the management of these strategic assets, Bill C-33 proposes to enable the Minister of Transport to designate the board chair from among, and in consultation with the directors.
This proposal would provide an important means to enhance board performance and would be complemented by other reforms, including new independent assessments of board governance practices and greater levels of transparency.
14. Borrowing limits are generally not reviewed or amended unless a Canada Port Authority requests an increase. To date, Canada Port Authorities rarely use their full borrowing limits.
At the same time, the government recognizes the importance of ensuring appropriate access to capital and supporting port development and innovation. Bill C-33 seeks to establish a review process of each Canada Port Authority’s borrowing plan on a triennial basis (e.g., according to a pre-determined schedule) to monitor port performance and requirements. To enable the borrowing limits,borrowing plan requirements would be set out in detail in the Letters Patent and specify clear reporting parameters consistent with international standards.
Such a reform would enable Canada Port Authorities to access manageable levels of debt, while reducing any financial risk to the Crown.
Reporting
15. Why does Bill C-33 seek to implement new reporting requirements?
15. Canada Port Authorities are federally incorporated, non-share corporations. They operate at arm’s length from the federal government. They fulfill important public policy objectives such as supporting national economic development and performing many regulatory functions relating to safety, security and environmental protection.
All reporting requirements proposed in Bill C-33 have been calibrated to ensure CPAs remain aligned with modern expectations of transparency and accountability.
Labour
16. The Government is introducing a Ministerial Order authority; how might this impact workers’ rights to strike?
16. The authority would not enable the Minister to interfere with a worker’s ability to strike as any Order must conform with the Canadian Charter of Rights and Freedoms, including freedom of association which encapsulates the right to unionize and strike.
The Ministerial Order authority contained in Bill C-33 seeks to provide the Minister of Transport with the ability to safeguard supply chains from a crisis. This includes climate events that can lead to supply chain disruptions that could require the direct involvement of the Minister to ensure coherent responses.
Marine Security
17. A secure transportation system promotes well-functioning supply chains and supports the competitiveness of the Canadian economy and its ports in a constantly changing world.
A modern, flexible, and agile marine security framework will ensure Transport Canada remains well placed to respond to increasingly complex security challenges.
The measures contained in Bill C-33 would ensure the Department has access to modern and flexible tools that are better designed to address security risks and respond to immediate threats in marine transportation.
These amendments will provide Transport Canada with the regulatory authorities it needs to be more proactive in addressing emerging challenges, such as biosecurity threats, which can have a significant impact on supply chains of the Canadian economy. The amendments will also provide a modern enforcement framework and oversight tools to promote ongoing compliance with marine security requirements.
18. In its current form, the Marine Transportation Security Act is solely threat-based, which limits its ability to address new and emerging security risks in the marine mode. The current authorities in the Act do not allow the Minister to make emergency directions to address an immediate threat, nor do they allow the Minister to issue interim orders to mitigate the impact of an urgent or exceptional security situation.
In addition to these current shortcomings, the Marine Transportation Security Act does not allow the Minister to enter into agreements with organizations or other government departments to oversee and/or enforce provisions of the Act and its regulations. This limitation directly diminishes the effectiveness of legislative and regulatory oversight. The proposed amendments will also allow the Minister of Transport to leverage expertise of organizations or other government departments to enhance its effectiveness in addressing security threats.
Taken together, these measures will better position the Government to address emerging and established security challenges in the marine mode.
19. When first introduced, the Marine Transportation Security Act addressed a long-standing omission in federal powers and provided government with the ability to respond to threats facing the security of people, goods, vessels, ports and facilities in the Canadian marine environment.
However, since its first introduction, Canada’s marine security landscape has shifted—concerns around physical disruption from terrorist actions still remain but new challenges have emerged relating to cybersecurity and biosecurity risks. The current threat-focused security framework is not well-suited to address these risks.
The new authorities proposed in this act will allow the Department to proactively address biosecurity or cybersecurity challenges by leveraging the expertise of other government departments and agencies to act as a force multiplier while applying Canada’s marine security framework.
20. The security-related measures contained in Bill C-33 will enhance the security framework for Canada’s marine transportation system, which is an important link in many national, regional and provincial supply chains. As such, ensuring marine security threats and risks can be appropriately managed is an important enabler of Canadian economic growth.
The proposed amendments to the Act by themselves will impose no new obligations on industry. They involve enabling authorities and new compliance and oversight tools that will allow amendments to be made to the Marine Transportation Security Regulations to enhance its effectiveness.
Those amendments will be subject to thorough consultation and subject to the regulatory process including a study of their costs and benefits that are made public through the Canada Gazette process.
21. How is the health of persons involved in the marine security system related to marine security?
21. The COVID-19 pandemic has highlighted the impact biosecurity threats, such as global pathogens, can have to public safety, the transportation system, and the broader Canadian supply chain.
In particular, the marine operations can pose a unique environment for the propagation of bio-security threats. A virus outbreak onboard a vessel or at a marine facility could have significant impacts on the health and safety of workers, including those with security responsibilities. In turn, this could have direct impacts on both Canada’s marine security posture and on our supply chain.
As such, it is crucial to ensure that the Department has the appropriate authorities to effectively address the risks associated with communicable diseases and other biosecurity threats in the marine mode.
The measures contained in Bill C-33 will introduce new authorities respecting the health of persons involved in the marine transportation system. These authorities in turn will promote the ongoing resilience of Canada’s marine transportation system.
Rail Security
22. What Railway Safety Act amendments are being proposed to enhance rail security?
22. With the rise in security incidents in Canada’s rail transportation system, these amendments are intended to ensure the safety and security of all Canadians and Canada’s supply chains.
Since the Railway Safety Act was adopted, amendments have largely focused on the safety aspects of the system. One of the recommendations stemming from the last Review of the Railway Safety Act, in 2018, was to expand the security focus in the Act.
To better address rail security in the Railway Safety Act, these security amendments would:
- Broaden the definition of safety to include security so that authorities in the Act would apply to security, to deal with existing and emerging security concerns.
- Introduce authorities specifically for security management systems (SeMS) so rail companies take a system’s approach to enhancing rail security, similar to safety.
- Create authorities for transportation security clearances (TSC) should they be deemed as an appropriate means to deal with possible insider threat.
- Create authorities that would be available for corrective measures to be taken when there is non-compliance with security regulations.
- Add new prohibitions to deal with unlawful, destructive and dangerous acts against railway operations including at stations and on-board passenger trains.
23. What is the purpose of a security management system (SeMS)?
23. Currently, the Act has express authorities respecting safety management systems (SMS), but not for security management systems.
A security management system is a formal framework for companies, so they integrate security into day-to-day railway operations. The benefit would be the ability for them to proactively manage security risks, adopt a security culture and enhance overall security posture against both potential terrorist attacks and other unlawful interferences.
24. Are Transportation Security Clearances (TSC) being proposed for the rail mode?
24. The proposed legislative amendment would provide the Minister of Transport with the ‘authority’, should this be an appropriate means in the future to deal with insider threats. The transportation security clearance program currently exists in the aviation and marine modes whereby every individual needing unescorted access to restricted areas of designated airports or marine ports across Canada is required to obtain a transportation security clearance.
25. How will the amendments prevent interference on railway operations?
25. Interference with the railway system can have a significant impact on public safety, the environment, and the economy. The Railway Safety Act currently prohibits access to railway line works. The proposed legislation builds in new prohibitions to prevent damage and destruction and mitigate the risks for rail workers, passengers and those that live within the vicinity of rail lines. Further to dealing with unlawful interference with railway works, equipment, and operations, it addresses unruly or dangerous behaviour at stations or on-board trains.
26. What amendments are being proposed to the Canada Transportation Act?
26. In keeping with evolutions in technology, the Government of Canada is adding clarity in legislation regarding the use of automated systems to make, or assist in making, administrative decisions to improve regulatory service delivery. The amendments also cover the ability to conduct oversight remotely by means of telecommunications for purposes of verifying compliance under any Act that the Minister administers or enforces and the regulations under those Acts.
Making these amendments in the CTA would provide consistent authorities across all modes for the use of automated systems in decision making and the use of telecommunications for remote/virtual enforcement activities.
The COVID-19 pandemic revealed the opportunities of leveraging technology and conducting aspects of oversight remotely rather than continuing with only on-site, paper-based inspections.
27. Is TC using automated systems to make decisions?
27. These amendments are intended to leverage technologies to deliver on the department’s core mandate. As new systems are implemented, their use should permit time savings for stakeholders dealing with Transport Canada.
Responsive only:
There are currently no automated systems in the department making detminations or decisions without human intervention.
Rail Safety
28. Were Indigenous peoples engaged on the proposed changes?
28. No, Transport Canada did not engage with First Nations, Inuit, or Métis during the process to draft these amendments to the Railway Safety Act (RSA). Proposed changes to the Act stem directly from the recommendations from the 2018 RSA Review conducted by an external expert panel. Transport Canada did not consult on specific proposed changes after the report was completed. Moving forward, we understand that we need to hear from communities and organizations as to how and if they want to be engaged on any given topic. In this respect, Rail Safety has developed an engagement plan to guide future activities related to discussions with Indigenous communities and organizations on the RSA. Rail Safety will continue to share information on the proposed amendments and the RSA overall, with the aim to begin engagement on the implementation of the amendments once the Bill has passed.
29. Do these amendments align with the latest recommendations from the Standing Committee (TRAN)?
29. The amendments included in Bill C-33 are in alignment with the recommendations of the TRAN committee in that they introduce new compliance tools, require the submission of information requested to assess an exemption request, and allow for increased transparency regarding rules developed by industry.
Of the 30-odd recommendations of the June 2022 Report, only one recommendation required legislative change. The recommendation I’m referring to relates to the issue of private railway police. At the time the recommendation was made, the Bill was already in late drafting stages, and it would not have been feasible to consider such a significant legislative change at the time. The Department is committed to doing the work necessary to address this important issue.
The remainder of the recommendations can and will be addressed not through legislative changes, but with changes to rules and regulations, or even through funding agreements or enhanced oversight activities.
30. The Railway Safety Act is unique in that it requires railways to comply with both rules and regulations. Under the Act, rules are developed by industry and submitted to the Minister for approval.
Prior to approving a rule, the department undertakes a thorough analysis of industry’s submission. Legislative amendments proposed in this Bill will strengthen the rule-making process by permitting Transport Canada to engage more broadly, for example with municipalities and Indigenous communities.
While the process to develop and approve rules and regulations is different, they both have the same force in law and railways can be fined or prosecuted for non-compliance with either.
31. Why do we need the new tool of compliance contracts to ensure compliance?
31. Having a variety of enforcement tools is necessary to achieve the highest level of compliance by the industry. Issuing fines is not always the most effective solution.
Transport Canada wants to promote compliance by providing other options that will enhance safety rather than only being punitive. Having different tools allows us to address different situations in the most effective way.
These commitments are recognized ways to incentivize collaboration and compliance, which ultimately leads to enhanced safety.
32. How would Canadians be involved in future reviews of the Act?
32. This would largely be up to the independent panel selected to conduct the Review. However, the Minister could direct the panel to consult as broadly as possible to ensure the most comprehensive reviews are conducted. There are endless options for engaging with Canadians. Information would likely be made publicly available, via web or local advertising. There would also be more focused, and subject-specific roundtables or town halls, et cetera. The Department is already considering various options for future reviews and the involvement of Canadians.
Transportation of Dangerous Goods
33. What is the purpose of the registration requirement?
33. To identify and collect sufficient information on TC’s regulated community. This will allow the TDG Program to better evaluate priorities for its risk-based inspection regime, improve the quality and availability of data on key stakeholders and their activities, and allow for more effective communication with these stakeholders.
34. Do other programs within TC have AMPs regimes?
34. Within TC, Civil Aviation, Marine Safety, Rail Safety and Motor Vehicle Safety already have AMP regimes incorporated into their various legislation. Implementing the TDG Program’s proposed AMP regime would therefore align with TC’s overarching approach to having its graduated enforcement policy applied consistently between modes with the underlying support of TC’s Centre of Enforcement Expertise.
35. What is the TDG Program proposing?
35. The Transportation of Dangerous Goods Act, 1992, will be amended to modify existing and create new authorities to better support the safe, secure and efficient TDG in Canada. Updated legislative amendments will provide the Minister with broader authorities related to ERAPs. The Minister will be granted the authority to revoke temporary and equivalency certificates in a wider range of situations. Another new authority will allow the Minister to designate officials, in writing, to exercise any of their powers under the Transportation of Dangerous Goods Act, 1992.
36. What prompted the need to define these terms?
36. Concerns have arisen due to the static nature of the Transportation of Dangerous Goods Act, 1992 framework, which wasn’t formulated to account for the evolving nature of the modern consumer market, nor the unforeseen impact of disruptive technologies on the nature of transportation and related activities. These recently detected issues, paired with the understanding that similarly unpredictable issues will arise in due time, have prompted the TDG Program to seek the necessary legislative authority to define these terms, as necessary, via regulation.