TRGO Committee Meeting

STANDING COMMITTEE ON TRANSPORT AND GOVERNMENT OPERATIONS

LE COMITÉ PERMANENT DES TRANSPORTS ET DES OPÉRATIONS GOUVERNEMENTALES

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, April 24, 2001

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[English]

The Chair (Mr. Ovid Jackson (Bruce—Grey—Owen Sound, Lib.)): Good morning, ladies and gentlemen. I'd like to start the proceedings. I see a quorum.

The order of the day is Bill C-14, an act respecting shipping and navigation and amending the Shipping Conferences Exemption Act.

We have two sets of witnesses. We will deal with them for the first hour. We have Mr. Mueller, Mr. Cartwright, and Mr. Morrison, and I understand we might have some other guests join us. Gentlemen, welcome. You have five minutes per group to make your comments, and then we're going to open it up for discussion from the floor. We usually have the first round at ten minutes and the subsequent rounds at five minutes for members of the committee.

Who is going to lead off this morning?

We have just one question from Mr. Laframboise.

[Translation]

Mr. Mario Laframboise (Argenteuil—Papineau—Mirabel, BQ): Thank you, Mr. Chairman.

I had sent the committee a notice of motion regarding a resolution to discuss the safety of the locks on the St. Lawrence Seaway, an issue which was raised in a coroner's report. It was my understanding that we would discuss my notice of motion on Thursday. Did I understand that correctly, Mr. Chairman?

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[English]

The Chair: For members of the committee, Mr. Laframboise did have a matter of importance to him that he would like the committee to consider. It has been tabled with the clerk, but it's in for translation and we will be discussing it on Thursday. He wanted to apprise us of this, so that nobody would be surprised about it.

Okay, gentlemen, you may start. Dr. Morrison.

Mr. Donald N. Morrison (President, Canadian Shipowners Association): Thank you, Mr. Chairman.

I'm Don Morrison. I'm president of the Canadian Shipowners Association. Bonsoir, mesdames et messieurs. We appreciate the opportunity this morning to contribute to the further discussion on Bill C-14.

[Translation]

First, I would like to point out what the Minister of Transport had to say before this committee. He said, quote:

The Canada Shipping Act is the main piece of legislation governing worker and environmental safety in the marine industry.

[English]

You can understand why we, as Canadian shipowners, are especially interested in this law. Our association represents the interests of Canadian flagship owners trading on the Great Lakes and St. Lawrence waterway, the Arctic, the eastern seaboard of Canada and the U.S. Our nine members manage some 87 vessels: bulkers, self-unloaders, tankers, and general cargo vessels. In the year 2000 we carried some 72 million tonnes of cargo in Canada and between Canada and the U.S.

Our mandate is to promote an economic and competitive Canadian marine transportation industry. Accordingly, we have been associated with the reform of this Canada Shipping Act since 1995. We have the support of the Department of Transport and have participated in all past consultative forums. With this amount of investment and work in the bill, I can say today that we are very supportive of it. We support the objectives of the bill and are of the opinion that these objectives, ultimately, will all be met. We do, however, have some concerns and comments to bring to the attention of the committee, and I'll briefly speak to a few of them, given our allotted time.

First, we note that parts 8 and 9 both deal with pollution prevention and the responsibilities of two different government departments, the Department of Transport and the Department of Fisheries and Oceans, this for the same issue. While members of the CSA respect the expertise of both departments, we do have a concern, and it's based on experience and history. There's a concern regarding duplication of responsibilities, services, staffing, and eventually, for our members, increased costs. These costs will, ultimately, be borne by the industry.

It may be problematic to have two departments responsible for enforcement, both for the departments themselves and for those of us in the shipping industry. Only one department should be responsible for pollution prevention. In this case, we support the Department of Transport as that department. Our members treat the environment with the highest regard and respect and have incorporated every precaution in their planning and operations to avoid environmental contamination of any type. This has been constantly exercised, but we support it totally.

Our members must remain competitive, and they have made very effort to increase their competitiveness through the use of technology, training, and consolidation of their services. Further savings to the shipping industry will have to come from legislative and regulatory efficiencies. We support effective planning and enforcement, but not this type of duplication.

Second, we are of the opinion that the level of fines throughout Bill C-14 is too high. Persons and/or vessels are liable on summary conviction to fines of not more than $1 million or not more than $100,000 or imprisonment for terms of not more than 18 months or not more than one year, or both. A fine of up to $1 million against a person appears to be extreme. We understand that people expect this law to last a long time and the penalties have to fit for the future, but we feel this is not the right approach and those fines are too high. We can agree that the marine mode is a leader, but please, not in this case and not in the levels of fines. We acknowledge that the threat of a substantial fine or imprisonment will certainly act as a deterrent, but we're concerned about this benchmark fine and how it will be established and justified, given the latitude and the range. There should be some relationship between the nature of the offence and the potential maximum fine. We suggest that these fines have to be cut at least in half.

Third, we have comments concerning the level of enforcement. We thought the previous levels of enforcement, which included indictable offences, summary conviction, administrative monetary penalties, and the ticketing scheme would have proven to be cumbersome and difficult to administer efficiently without a large enforcement staff. Accordingly, we're pleased that the previously proposed ticketing scheme has been deleted and that the number of indictable offences has been reduced substantially, this through consultation with the Department of Transport and the senior officials. Our concerns about the administrative penalties relate mainly to the lack of due process and the fact that so much appears to be left up to regulations yet to be determined.

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Clause 233 gives the Minister of Transport discretion on how to proceed with a contravention either as a violation or an offence. With regard to this office, we are of the opinion that there is a lack of due process in this process itself. The person charged should be involved in the process and the ultimate decision on how to proceed through an acknowledgement of his guilt or innocence. We think that this process needs to be given more consideration.

We note that clause 239 permits a five-year period for the notation of a violation or default, a suspension or cancellation, or a refusal to issue or renew a Canadian maritime document to remain on the records that the minister may keep respecting a person or vessel. If there is no public interest in maintaining a record of the violation or suspension, then a five-year period seems overly long and somewhat prejudicial to the party involved. We agree that some period is necessary, but we feel that it should be substantially shorter. I think we should be looking at a timeframe of about a year.

In the same vein, clause 241 has a two-year period during which a notice of violation can be issued. People could wait up to two years for this issuance. Again, it is a long period of time, and it would undoubtedly lead to enforcement problems and administrative inefficiency. We agree that some time is required for decision-making, but this time should be kept to a minimum—months, not years—for the benefit of all parties. In this case we would suggest six months.

In conclusion, we're largely supportive of this bill with the exception of my comments today. Our members urge you to consider these comments from the perspective that legislative and regulatory reforms must contribute to the improved economic performance of the marine industry. Otherwise, a disservice will have been done to the Canadian shipping industry.

In our preliminary note to you we suggested that we might have other comments, and we do. I will speak to them in the time we have.

Also, Captain Réjean Lanteigne is here. He knows this bill in detail as much as anyone does, and he can answer questions on it.

Our supplementary comments include subclauses 10(3) and (4). To gazette every exemption means a delay in the granting of that exemption. We feel it's a time delaying process and it serves little practical purpose.

With regard to subclause 12(1), the Canadian Shipowners Association would be opposed to any designation where a society or other organization would be made agents of the crown.

With regard to clause 14, we find it hard to understand why the wording of the bill doesn't allow for the owner to appoint a duly authorized representative, such as a ship manager. As in clause 98, it allows for the authorized representative to enter into an agreement with another to provide crew members. It seems to be implied in clause 14 that one could appoint a manager.

Next is subclause 54(2). It's a minor point, but we feel that any certificate of registry should include the name of the vessel.

Subclause 54(3) specifies that every certificate is valid for the period specified by the chief registrar. In the current Canada Shipping Act, which was modified three years ago, this power was given to the minister. We fail to understand why it has to be changed now and given to the chief registrar.

Subclause 57(1) empowers the chief registrar to specify the form and manner and other information to be marked on a vessel. Here again we do not agree that discretion should be granted to the chief registrar as written in subclause 57(1).

Subclause 126(2) authorizes the Minister of Fisheries and Oceans to “designate as marine communications and traffic services officers persons in the public service of Canada who meet the requirements specified by the Minister”. It's the only clause in the whole bill where a designated person has to be presently in the Public Service of Canada. We can refer you to clauses 130, 135, 154, 174, and 195. We feel that it's not only public servants who could perform the work of marine communications and traffic services officers.

At this time, Mr. Chairman, I'll say thank you very much for this opportunity to appear. The Canadian Shipowners Association hopes that our comments will fit into the final bill.

The Chair: Thank you very much, Mr. Morrison.

Who is next? Mr. Cartwright.

Mr. Ron Cartwright (President, Chamber of Shipping of British Columbia): Good morning, Mr. Chairman.

First of all, I'd like to apologize for not distributing earlier a version of what I have to say in both English and French. I do have English copies here of the text I'm going to speak to.

Just by way of credentials, the Chamber of Shipping of British Columbia is based in Vancouver. Our constituents are largely the deep sea. We also have marine lawyers and associate members, including insurers and financial institutions. The B.C. Ferry Corporation is also a member of the chamber. Since their concerns are specific to their operation, I have included their comments as an appendix to my presentation.

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I should also mention that rather than just take a narrow perspective, we discuss legislation such as this with our counterparts and sister organizations. We have discussed Bill C-14 with both the Council of Marine Carriers, which is the domestic tug and barge industry on the west coast, and the west coast section of the Canadian Maritime Law Association.

We support the legislation, which we have done consistently since it was tabled. We have just a general concern not to see change for its own sake or that a radical streamlining of the form or function of the legislation doesn't generate more problems. The concerns are cautionary and by no means blunt our basic support for the review and the process.

Specifically, I'll just address one or two of the key topics that we mention. The title of marine safety inspector is a very general one to cover what is now a multi-tasking of one individual for different functions. We think that this should be a little more specific and, particularly in the case of international vessels, that the marine inspector should have some means of identifying his specific function, whether he's a port warden or is there for port state inspections. That should be clearly enunciated to the vessel's master.

Another concern is subclause 12(5) on immunity. We recognize the sentiments behind the clause, but we believe that someone should bear ultimate liability. Obviously, in our mind that should be the crown. We suggest that this clause be amended to take this into account.

Under subclauses 14(1) and (5), authorized representative, we find that the current wording is too strict. It doesn't actually cover the full range of possibilities, including fraudulent action by the authorized representative. We recommend that the text be qualified to cover those acts by the representative that fall under the act or its regulations.

With regard to clauses 26 and 28, the Marine Technical Review Board, in view of the increased complexity of technology now applied in the marine mode and the significance of this review process, we suggest that the applicant to the review panel be consulted on the selection of panel members in order to ensure that the panel has qualified access to the appropriate technology and specialized knowledge. A panel member must be truly independent, and it should exclude any person having involvement in previous inspections of the vessel.

Under part 3, personnel, clauses 82 to 84, we suggest that a clause be added requiring a person to leave the ship on the order of the master or the person responsible for the vessel. This would avoid a potential illegal occupation of the vessel.

Next is part 4, safety. From earlier correspondence with the department, we understand that clause 109 contains the obligation of the master to ensure safety of life and of the vessel. This has been explained to us as giving the master the right to seek a port of refuge. It is our opinion that this accepted right is not apparent when interpreting the text under clause 126, powers of the officers, and clause 175, powers over the discharge of a pollutant. We believe that a limited statement such as is contained in subclause 227(2) may well answer this concern.

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In context, I'd just like to draw the committee's attention to the unfortunate happenings around the recent ERIKA grounding off the coast of France. I think this illustrates the consequences of an uncontrolled scenario. The master had no given option to seek a port of refuge and as consequence there was horrendous pollution instead of control.

Part 8 deals with pollution prevention in terms of the Department of Fisheries and Oceans. We consider the wording in paragraph 175(1)(a) to be too wide. It should be modified, to allow the officer to ask reasonable questions, similar to the wording in subclause 211(4), part 9.

Part 9 looks at pollution prevention with regard to the Department of Transport. We firmly believe wording should be incorporated here that states that the vessel or owner, if charged under this act, cannot be charged under another act.

Subclause 191(2), under the same part, represents an arbitrary punishment. In contrast with other areas, it does not indicate a scale of punishment that would reflect either the volume of the pollutant, significant or minuscule, or the circumstances of the incident, inadvertent, deliberate, or without due diligence. We recommend that some form of secondary scale of punishment be listed to cover the minor, inadvertent infractions. In consideration of the comment I've just made, we recommend that, in subclause 191(4), the word “shall” be substituted for the word “may”.

Part 11 deals with enforcement in terms of the Department of Transport. As a general statement, we believe the appeal process should be clearly spelled out in this legislation. For example, the Transportation Appeal Tribunal of Canada should have some cross-reference in Bill C-14.

We also have strong concerns with regard to the current wording of subclause 211(4). We believe the wording—

The Chair: Excuse me, but if these presentations go on for much longer than five minutes, it doesn't give a lot of time for questioning. Be concise, please, if you would, and wrap it up.

Mr. Ron Cartwright: Okay. I'll go straight to part 15, if I may, and that would be the conclusion, really.

Shipping conferences, we believe, have been a vital component for liner shipping for many decades. They serve a good purpose in terms of bringing stability in price, to the benefit of the marine transportation users, shippers, and exporters. We believe the text currently contained in the draft is supportable by the conferences, who, as a consequence of serving and providing regular liner services to the maritime users, have to invest in vessels, infrastructure, and related activities. We believe the present text will maintain that support, and we'll support their continuance to provide predictable liner services. Our view is that the clausing is fine as is and should be left as is.

Thank you.

The Chair: Thank you.

Mr. Bélanger.

Mr. Gilles J. Bélanger (President, Shipping Federation of Canada): Mr. Chairman, thank you, and members of the committee, good morning.

My name is Gilles Bélanger, and I'm president of the Shipping Federation of Canada. For the purposes of question period, I have with me Anne Legars, our director of government and legislative affairs.

The federation represents over 95% of ocean vessels, including international cruise vessels, that trade internationally to and from ports in Atlantic Canada, the St. Lawrence River, and the Great Lakes. Our members are listed in appendix one of our brief.

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The federation welcomes Transport Canada's efforts to modernize and streamline the Canada Shipping Act, a vitally important piece of legislation for our industry. On the whole, the federation supports Bill C-14 and is basically satisfied with it.

The federation also wishes to testify that the consultation process held by Transport Canada proved to be extremely fruitful in terms of streamlining the issues and fixing all kinds of drafting problems at an early stage, which means today we can discuss mostly policy issues.

Our brief contains the details of our representation, but in this presentation today I'd like to touch on three policy issues: the proposed administrative penalty regime; the framing of the minister's discretionary powers; and the fairness of treatment between modes.

Bill C-14 grants the government powers in rule-setting, enforcement, investigation, and adjudication that are much wider than under the current Canada Shipping Act. We fully recognize that Transport Canada needs flexibility as well as broad powers to fulfil its mandate efficiently. However, we submit that demonstration has not been made to justify granting governments such powers over quasi-judiciary processes that would provide the minister with the power to appoint adjudicators, who will eventually revise his own decisions, and to choose, at his sole discretion and advantage, whether to proceed in a judiciary or administrative penalty process.

The proposed regime would decriminalize most of the contraventions to the act by withdrawing the procedural safeguards existing in criminal law—for instance, the burden of proof and rules of evidence—while keeping penal consequences for the contraveners. The industry does not oppose the general concept of administrative penalties as such when applicable to less important contraventions, but it strongly opposes it when applicable to such a range of contraventions with serious consequences and very few procedural safeguards.

The federation opposes the administrative penalty regime as proposed in the present bill because it does not believe an adequate balance has been reached between the procedural guarantees provided for in the bill and the consequences of a finding of violation. We also submit that several common law procedural safeguards should be stated explicitly in the bill, since persons who are not judges will be adjudicating violations.

A second policy issue relates to the need to apply guidelines and safeguards to the increased powers granted to the government in the enforcement of the act. We recommend that some standards of performance be introduced. This is especially needed if some of the administration's decisions are to be reviewed by adjudicators, who do not have the same level of judicial expertise that courts have.

The third policy issue relates to fairness of treatment between modes. We make several recommendations aimed at either getting in line with other modes or mirroring squarely the Aeronautics Act's corresponding provisions. Apart from these major policy concerns, we make some specific recommendations aimed at clarifying some concepts and definitions.

Finally, Mr. Chairman, the federation wishes to file its strong support of part 15 of the bill, which amends the Shipping Conferences Exemption Act. The proposed bill modernizes the act and meets the key requirements of the shippers while protecting the existence of international shipping to and from Canada.

[Translation]

Ladies and gentlemen, members of the committee, thank you for listening. I would be pleased to elaborate on the Federation's position during the round of questions.

[English]

Thank you, Mr. Chairman.

[Translation]

The Chair: Thank you very much, Mr. Bélanger.

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[English]

Mr. Mueller, you're next on deck.

Mr. Walter Mueller (Secretary, Canadian Shippers' Council): Thank you, Mr. Chairman, members of the committee.

My name is Walter Mueller, and I'm secretary of the Canadian Shippers' Council. I would like to thank you for providing us with this opportunity to appear before your committee in the context of your review of Bill C-14. The CSC's interest is limited to part 15, the proposed amendments to the Shipping Conferences Exemption Act, 1987.

The council represents shippers from across the country and is the designated shipper group under the provisions of SCEA. It has participated in several previous reviews of this controversial cartel legislation since the council's creation in 1966, unfortunately with little success in terms of achieving a reasonable balance of power in this legislation.

During the recently completed government review of this act, the CSC provided a number of views and recommendations to the Minister of Transport and staff at Transport Canada for urgently needed modifications. The CSC views SCEA as anti-competitive, outdated, and self-serving to shipping cartels and to member carriers, the majority of which are foreign-owned.

In light of OSRA, the Ocean Shipping Reform Act of 1998, implemented in the United States two years ago, a major overhaul of the Canadian act had become absolutely necessary to ensure that Canadian shippers were not kept at a disadvantage compared with their U.S. counterparts. The CSC proposed amendments to SCEA to remove its ambiguities, bring it into line with OSRA, and provide some balance of power between shippers and carriers.

These amendments were the following: provide the ability to negotiate confidential contracts; provide shippers with a simple and effective dispute resolution mechanism; sunset antitrust immunity; exclude from antitrust immunity the stabilization agreements and other forms of restrictive agreements; eliminate tariff filing by conferences; reduce the notice period for independent action to five days; and permit conference carriers to negotiate inland and intermodal rates as a group.

These modifications will retain, at least for a specific period of time, the principle of antitrust immunity for conferences, just as the U.S. OSRA does, but they will give shippers the freedom to negotiate confidential rates and services with the carrier of their choice. While the sunset provisions will put conferences on notice as to antitrust immunity, it will give them a reasonable timeframe in which to adjust to an environment of strictly market-based principles.

It is a well-known fact that the cost of transportation is one of the most important factors in ensuring Canada's export competitiveness. Canadian industry must have free competition, marine transportation costs based on the most efficient carrier, and the ability to negotiate with conference lines in the same manner that they currently negotiate with railways and motor carriers.

The revision of SCEA, as outlined in part 15 of the bill, unfortunately contains very few of the CSC's recommendations. The changes that have been included represent mainly administrative relief and cost benefits for the carriers only. Canadian shippers are deeply disappointed with the SCEA amendments proposed by the Minister of Transport. After more than two decades of periodic reviews of this act, this is another lost opportunity for the government, and Canadian shippers are again the big losers.

The proposed changes do not satisfactorily address any of the fundamental issues that have plagued Canadian shippers since SCEA was originally proclaimed in 1970. Contrary to the minister's press release of March 1, 2001, the revised SCEA does not align Canadian regulations with OSRA and has ignored virtually all of the CSC's four major recommendations: one, confidentiality for individual contracts; two, dispute resolution mechanisms; three, sunsetting antitrust immunity for conferences; and four, excluding all restrictive forms of agreements from antitrust immunity.

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The proposed SCEA revisions do not provide for a confidential service contract between conference carrier and shipper. The provision only states that the carrier is not obligated to divulge the terms of such contract, but nothing in the law prevents the carrier from doing so anyway.

OSRA, on the other hand, in its section 10, prohibits a carrier from disclosing any information in a service contract or the transaction that the contract covers. It safeguards confidentiality to the shipper and is considerably more restrictive on carriers than the proposal in SCEA.

OSRA also deals extensively with concerted action by conferences in section 11. It provides a simple and effective provision for filing of a shipper complaint and for obtaining remedy for injury caused. SCEA, on the other hand, contains no such claims provision nor potential relief for shippers.

A new and revised SCEA must clearly address the issues of service contract confidentiality and safeguarding of shippers' interests by providing carriers, in unmistakable language, exemption from disclosing any information of a service contract or the transaction that such contract covers.

The new act must also give Canadian shippers a simple but effective tool in the form of a dispute resolution process to obtain remedies or reparation when conferences or the member carriers abuse their power with respect to freight rate matters, surcharges, ancillary charges, or when they are in contravention of any of the provisions of the legislation.

When one minister says that the new SCEA is a prime example of the Government of Canada working in partnership with its stakeholders, Canadian shippers are sad to see that they and their concerns have again been totally left out of that partnership consideration. In our mind, it is clear that the conference lobby, consisting exclusively of foreign-based ocean carriers, has again succeeded, with totally inaccurate information, to convince authorities of the continued need of antitrust immunity for them.

They continue to claim that they provide the stability and service in freight rates to the trade, and that unless Canada retains the antitrust protection for them, they would move their operations away from Canadian ports. Why is it then that it is conference carriers who move in and out of conference arrangements as it suits them, and who operate quite successfully as independent carriers, in different trades, without antitrust immunity?

It is also they who are the price leaders on freight rates when major rate restoration programs are implemented, sending rate levels sky-high while independent, or non-conference carriers—who have no antitrust immunity—merely follow the trend established by conferences. This makes conference cartels the greatest offenders on rate and service stability, yet they continue to claim such stability as their own invention.

The livelihoods and financial success of conference carriers does not depend on their antitrust immunity and on protection from normal Competition Act provisions. We are profoundly disappointed that the Canadian government succumbed to the threats that they would withdraw service if they didn't like the amendments of SCEA. This is incorrect: carriers will seek out cargo, if it is there, to be carried at a profit.

The Canadian government should be asking itself why carriers are so interested in, and insistent on, maintaining a rate-setting mechanism that is outdated, anti-competitive, and skewed in favour of the carrier. The answer is that it allows carriers to allocate shippers amongst themselves, limit competition, and protect an otherwise costly and non-competitive system.

In any other industry, this would be known as price fixing and collusion. Several international organizations have been addressing the question of antitrust immunity. Some have put forth a strong case either for outright abolition, partial abolition, or for some setting of antitrust immunity for liner conferences.

Canada has an opportunity to move in that direction in an equitable way for all stakeholders and must not miss that chance. Today we are left with few so-called conferences as identified under SCEA. However, we have an increasing number of rate agreements, discussion agreements, stabilization agreements, and so on. The membership often consists of regular conference. and non-conference, carriers. Some have official tariffs; others disguise them under the term of voluntary guidelines. They all, however, seem to have the same common structure, which is generally established to find ways around liner conference regulations such as SCEA. This is causing shippers enormous problems.

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The Canadian legislation does not cover this diversity of cartel operations, yet authorities have silently tolerated it. Neither the Canadian Transportation Agency, the Competition Bureau, nor Transport Canada have been able to provide the CSC with a formal ruling whether or not these groups fall under the current conference definition of SCEA. However, they all continue to benefit from antitrust protection as true conferences do—even their non-conference carrier members. The CSC request for clarification of this serious issue seems to have been ignored by the authorities and the proposed new SCEA remains in total darkness over the current ambiguities.

We request that the current conference definition be clarified and strengthened in the act, eliminating all other restrictive forms of agreements—as the ones mentioned above—from antitrust protection.

In closing, we wish to reiterate that the CSC's ultimate objective remains the abolition of SCEA and of antitrust immunity for liner conferences. This is consistent with the 1992 recommendations of the National Transportation Act Review Commission.

In the interim, the CSC respectfully submits that the Canadian government must modify the current SCEA legislation in line with the proposals made by the CSC on behalf of all Canadian shippers. A new act must finally provide a balance of power between shippers and carriers.

Thank you.

The Chair: Thank you, Mr. Mueller. You've actually taken up a lot of time.

If we're going to go until 11:05 with questions, we'll start with Mr. Fitzpatrick of the Alliance Party.

Mr. Brian Fitzpatrick (Prince Albert, Canadian Alliance): I wanted to deal with the question of the enforcement officers, the inspection personnel, and so on under this act, because I think somebody did allude to this matter.

I'm going to draw on something I saw in the Auditor General's report. It was a comment that, far too often in the public service, we're getting people appointed to key positions who don't have the right qualifications to do the job. I'm curious what the industry feels in this area. Are you satisfied that the people you're going to be dealing with here are going to be competent, qualified people who understand the shipping industry thoroughly and who are competent to make determinations as far as these regulations and so on are concerned?

Mr. Donald Morrison: We can help with that answer. I'd ask Captain Lanteigne, who has dealt with these people for many years, to make a comment.

Captain Réjean Lanteigne (Canadian Shipowners Association): That's a very good question.

I listened carefully to what was said by brethren of my association, Don Morrison, Mr. Cartwright, and Mr. Bélanger. I don't think anybody mentioned that we had some concern with the qualifications or ability of the individuals performing the tasks required to be performed under the act. The comment that Mr. Morrison made was with regard to one particular clause of the bill, namely subclause 126(2), that calls for the marine communications and traffic officers to be designated by the minister and these officers have to be from the Public Service of Canada. It is the only place in the bill where a designated officer to perform a task required under the bill has to come from the Public Service of Canada. We fail to see why this is the case. We see no reason why that person should be, by legislation, from the public sector. But nobody has made a claim that any officers—

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Mr. Brian Fitzpatrick: But I take it the legislation is a bit open-ended, or it leaves a lot to interpretation as to how people are going to be appointed or selected for these jobs and where they come from and so on. The only section that refers to somebody in the public service is that one section. I would assume you're going to need a lot of inspection and enforcement people.

Capt Réjean Lanteigne: It is still the prerogative of the ministers of fisheries and oceans or transport in clauses 130, 135, 154—in many, many clauses—to designate officers. And I can tell you, as a former marine safety officer for a big part of my career, there are a lot of checks and balances in the employment or the service of these officers.

Mr. Brian Fitzpatrick: There was mention made of the administrative penalties. I would assume administrative penalties would be penalties for things that are of a minor nature, and the penalties for that sort of thing would be minor in consequence too. Is that not the case as far as the shipping industry is concerned?

Mr. Gilles Bélanger: We don't feel that is the case. Of course, some of these penalties or the process under which contraventions will be dealt with will probably become more specific as the regulation is adopted. But at this point, it's open-ended, and we feel that a number of the contraventions are of a far more serious nature than the type we'd be comfortable handling under an administrative penalty.

Mr. Brian Fitzpatrick: So the concern would be that an enforcement officer could take something of a serious nature and charge somebody under an administrative section. Is that the concern here, that this kind of discretion is open?

Mr. Gilles Bélanger: Yes, that discretion is open, and part of our main concern is that some of the contraventions are very serious and the consequences or the penalties are very high. Under the administrative penalty regime, the contravener doesn't have the protection of the judiciary system with all its checks and balances. That is a concern for us.

Mr. Brian Fitzpatrick: I have a concern in this area, a personal concern. I feel if somebody is not at fault for something, it's wrong that they're convicted for it, whether it's administrative or otherwise, and you should certainly have the ability in the system to defend yourself if you're not at fault. If I'm hearing this correctly, there is a concern here that the process really isn't there, or is very weak in some of these areas, and the ability to defend yourself, even using a defence of due diligence, is maybe not there.

Mr. Ron Cartwright: Yes, that's certainly one of the concerns we have. There really isn't the scale of punishment that would reflect the nature of the offence. And of course we have concerns about discretionary powers from individuals. We are also fairly reassured by the department on the action they're taking to ensure we have a standard interpretation across the country with different inspectors. But the whole idea of multi-tasking individuals means there's quite a challenge to ensure that in the end there is proper appreciation of the nature and scale of the infringement, whether it was deliberate or whether it was simply inadvertent, in spite of due diligence. So yes, we need a little more flexibility in scaling of the....

Mr. Brian Fitzpatrick: There was some mention about the penalties and the sentences that could flow out of this—a million dollars in a year. But those are maximum sentences, are they not? You're not talking about.... I take it they would only arise in the most serious of cases. The adjudicator would have the ability to assign the appropriate penalty for the infraction. The Criminal Code is full of those sorts of provisions, up to life imprisonment and large penalties, but in most cases we never really see those penalties assessed except in the most extreme cases. I assume this is the case here too, but maybe you have a concern here that I didn't pick up on.

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Mr. Donald Morrison: We have a concern because of the level. When you mention someone other than a judge or the court system setting these fines against a person, we have a concern about how it's going to be applied.

The Chair: You have about a minute and a half left.

Mr. Brian Fitzpatrick: I'll just direct a question to Mr. Mueller on the conventions. Let's take the example of the Port of Vancouver dealing with a convention.

Mr. Walter Mueller: A conference, you mean?

Mr. Brian Fitzpatrick: A conference, yes. If somebody's shipping through the port of Seattle, are they not up against the same sort of problem?

Mr. Walter Mueller: If they shipped out of Canada, yes, it would be under Canadian regulations.

Mr. Brian Fitzpatrick: Right. But there's a concern that we're going to lose our competitive position when compared with American ports and so on. Are they not up against the same type of problem?

Mr. Walter Mueller: If you look at strictly U.S. regulations under OSRA, that won't be the case because of their confidential contract provisions. Right now they're in a better position than we are here in Canada.

I think the whole concept of the carriers leaving Canadian ports has to be looked at with a big question mark. It's hard to imagine that, for instance, the North Atlantic Conference, which uses the ports of Montreal and Halifax, would stop calling on these ports when they carry 65% of their cargo from the U.S. midwest as non-conference carriers. For the other 35% here in Canada, they need to be a conference and have antitrust immunity.

Mr. Brian Fitzpatrick: But would there not be a possibility that if the conferences are not competitive in Canada, the traffic or cargo you're talking about, the 65%, would simply move through the U.S. ports and not come here?

Mr. Walter Mueller: Well, if that had been the case, it would have happened as a result of confidential contracts in the U.S. The Canadian gateway is a better and more competitive gateway. It has a shorter transit time from the U.S. midwest to Europe than it has through the U.S. So it will always have advantages.

As well, the famous harbours tax in the U.S. makes them even more non-competitive in those areas.

The Chair: Thank you very much, Mr. Mueller.

Brian, you're out of time. I'm trying to make sure other opposition people get a chance before we run out of time.

Mario.

[Translation]

Mr. Mario Laframboise: Thank you, Mr. Chairman.

I am obviously going to ask my questions in French, so please adjust your earphones.

Mr. Morrison, you have three main concerns with Bill C-14. You say you are supportive of Bill C-14, but you have three main concerns that are somewhat surprising to me.

First, with respect to parts 8 and 9, which deal with pollution prevention, you say you are concerned about duplication and increased costs, given that the responsibilities are shared by two departments. Personally, I was under the impression that this bill actually divided everything up between both departments, determined what Fisheries and Oceans was responsible for and what Transport Canada was responsible for, and that would finally set the record straight for both departments in the area of pollution prevention.

What you are basically saying to us is that we should get rid of the Department of Fisheries and Oceans. When you get right down to it, that is what you are saying. It seems to me that as far as pollution is concerned, if there is one department that is liable to be affected by pollution, it is above all Fisheries and Oceans, so I have some trouble following you. I would like you to clarify your position on that.

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Mr. Donald Morrison: I believe we said in our presentation that for us, it is quite clear. We do not wish to have to contend with the increased costs of duplication. We do not mean to recommend doing away with a government department like Fisheries and Oceans. What we said was that on pollution issues, we would prefer to deal with Transport Canada than Fisheries and Oceans, and I would ask Captain Lanteigne to say more about that. We have had to deal with duplication in other situations, and we do not want that to continue.

Capt Réjean Lanteigne: It is not for us to tell the government how it should be organized. Five or six years ago, the Coast Guard was part of Transport Canada. In Canada, there was thus one department responsible for all environmental issues involving marine transport. The government chose to transfer Coast Guard to Fisheries and Oceans. Now we are faced with a bill in which the statutory responsibilities are shared by two departments. We have already seen, it is quite clear, that this leads to quite a significant amount of inefficiency, to quite significant duplication, and to quite significant costs to government and the industry in cases of pollution.

The last thing we want to see in the event of pollution is inefficiency. You need efficiency because you need to react quickly and effectively. In recent years, in cases involving our members' fleet of ships, there has been a serious lack of efficiency in terms of the time it took to get a response in pollution cases and in terms of the time it took to fight the pollution.

It is not up to us to decide how this should be organized, but it is our job to make comments on the legislative organization, the division of roles.

Mr. Mario Laframboise: So what you were saying is that this bill does not clarify each party's responsibility.

Capt Réjean Lanteigne: No.

Mr. Mario Laframboise: In your view, it does not clarify the tasks. The situation will be just as complicated and there will be huge costs to pay because of the duplication—

Capt Réjean Lanteigne: ... if not more complicated. Yes, Sir.

Mr. Mario Laframboise: You will appreciate that we in Quebec have some experience with duplication and with huge costs as well. So if you have any examples, please send them to me. I will be pleased to table them with the committee.

My second question will be directed to Mr. Bélanger, because he also spoke about fines. Obviously, there are certain penalties involved. You say that fines of $100,000 or $1 million are excessive. I have trouble understanding that, because if I look at paragraph 101(1)(a) of the bill, fines of $1 million are for “operating a vessel without sufficient and competent crew”, or, in paragraph 101(1)(b), “willfully obstructing the operation of a vessel”.

I think these are very important things that warrant significant penalties. You say that $1 million is rather a lot. We could advance figures of $500,000 or $1.5 million, but the fact remains that the offenses mentioned in the bill called for significant fines. If an individual willfully obstructs the operation of a vessel, he or she deserves to be punished. In the case of the $100,000 fines, there is a reference to the requirement to hold a certificate or document and to comply with notification from the minister regarding medical matters on vessels. I do not think this fine is excessive.

Mr. Gilles Bélanger: We have a two-part response to this. The first part is this: why should the entire maritime community be penalized compared to other modes of transportation? First of all, this type of fine does not exist in other modes of transportation, and secondly, maritime transportation is the safest and most efficient mode from the environmental point of view, etc. So despite the fact that we have the best safety record, all of a sudden, we have to pay higher fines than other modes of transportation. We have trouble understanding that. Why should the maritime transportation sector be penalized, given that in that respect, it already has a better safety record than the other modes?

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The second part has to do with the administrative penalties regime. Our concern as in the case of very substantial penalties, there could be an administrative process involved. That creates problems for us, and we would very much prefer that these offenses be dealt with through a judicial process.

For example, in the case of a $1 million fine, the firm that is charged would be able to put forward a defence. Obviously, the company would use every means available to defend itself. It could refer to the Charter of Rights or to certain parts of the Constitution. We would be concerned about having to do that through an administrative process, before people with no legal training.

Mr. Mario Laframboise: Fine! If I might, Mr. Chairman—

[English]

The Chair: Mario, you have about a minute and a half.

[Translation]

Mr. Mario Laframboise: All right. When you say that your industry is not treated in the same way as the others it seems to create a difficulty in my view. The fact remains that you are really in a unique situation, and clause 137 makes it clear when it mentions that you must “assist persons in distress”. You work on the water, and there is no traffic as there is on the highway or in the cities. That is why you are required to assist persons in distress and there is a penalty or a fine for failing to do so.

Clause 138, for its part, prohibits you from entering, leaving or proceeding within a zone without a clearance. Borders are not visible to the naked eye at sea. Thus, if everyone goes anywhere, any time without clearance, there could be problems.

Consequently, I think that precisely in the case of your type of industry, given that the obstacles or the places where you are allowed to travel are not fully defined or not defined at all, and that you are required to assist persons in distress because there are not a lot of vessels around, it is proper that there be appropriate fines. That is my view.

With respect to the administrative penalties, I thought the bill streamlined the entire process for processing penalties. You are saying that it may complicate the process with judicial procedures and other things.

Mr. Gilles Bélanger: That is true in some cases, at the very least. What I mean, and what we say in our brief is that certain less important fines could be dealt with through a system of administrative penalties, whereas the more important ones should continue to be dealt with through judicial procedures.

The Chair: Thank you, Mr. Bélanger.

[English]

Ms. Desjarlais, from the NDP.

Mrs. Bev Desjarlais (Churchill, NDP): Just to follow quickly on that comment, to make sure I heard the translation right, you're saying the less important one should go before the judicial but the administrative—

Mr. Gilles Bélanger: The other way around.

Mrs. Bev Desjarlais: Okay, because the interpretation came out a certain way and I was.... Okay.

Mr. Cartwright, you commented on charges under possibly different acts. Were you talking about charges related to the same issue, or were you talking about the same issue but from a different angle? I'll give you a for instance. In a highway accident, you might have charges under the motor vehicle act, but you might also have criminal charges, depending on what happened.

Mr. Ron Cartwright: Yes, really, it's the same offence, but if it is feasible to charge under different acts for the same offence, we think the equity would be that once charged under the CSA, then related acts would not apply.

Mrs. Bev Desjarlais: What if there was a different outcome as a result, so you then ended up being charged under the other act? Using the example I gave, you might have charges under the motor vehicle act, but you might have criminal charges as well. In that instance, you don't think it should happen either?

Mr. Ron Cartwright: We think the selection should be made clearly at the beginning of the proceedings and that an owner should only face one charge under a specific act.

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Mrs. Bev Desjarlais: What if there were something else found out in the investigation of whatever happened?

Mr. Ron Cartwright: I think the charge should be laid at the time when there are sufficient facts known to appreciate which is the correct act to charge under.

Mrs. Bev Desjarlais: But you are aware that in most instances, whether in criminal law or in other cases, often in the process of an investigation or at some point even in court proceedings, other information comes out, so there may be additional charges later. Are you saying that shouldn't be the case under the Shipping Act?

Mr. Ron Cartwright: I think what we are really addressing is a kind of scattergun approach to an offence where an owner may be faced with charges under several different acts in the hope that one will stick. That's really our concern. Normally with marine incidents there is sufficient time during the investigative procedures to make a charge, an appropriate charge, under the appropriate act.

Mrs. Bev Desjarlais: Okay.

Mr. Morrison, the carriers that operate in Canada under our guidelines are often the same carriers that operate in the U.S. under OSRA?

Mr. Donald Morrison: No.

Mrs. Bev Desjarlais: You don't have any of the carriers that operate in both areas?

Mr. Donald Morrison: In the Great Lakes, yes, but only there.

Mrs. Bev Desjarlais: So you never have the same carriers operating in the U.S. that would operate in Canada.

Capt Réjean Lanteigne: None of the business of transportation we're involved in, either in petroleum products, dry bulk products, or anything else, is covered under the conference regime. So part 15 doesn't apply to any of the U.S.-Canada business.

Mrs. Bev Desjarlais: The carriers that operate in the U.S., where they don't have the exemption under part 15, are they in a situation where they're not financially feasible, where they're going to go under because it has created such a hardship?

Mr. Gilles Bélanger: The carriers operating to and from the U.S. have similar protection to what is proposed here under part 15. They have the protection against the antitrust laws. They have the possibility of contracting individually out of the conference, as is proposed here. So basically what 15 is doing is making our act more or less comparable to OSRA.

Mrs. Bev Desjarlais: Are the U.S. carriers not obligated not to release those contracts? Do they not have a legal obligation to keep those contracts confidential?

Mr. Gilles Bélanger: Not to my knowledge.

Mrs. Bev Desjarlais: Mr. Mueller, you're shaking your head.

Mr. Walter Mueller: Yes, indeed.

Mrs. Bev Desjarlais: Can you tell me...?

Mr. Walter Mueller: U.S. OSRA does provide antitrust immunity. But there is a major difference. They have confidential service contracts. We are proposing service contracts with no obligation to the carrier to divulge the details.

In the U.S., confidential contracts are filed with the FMC. There are clauses that prohibit carriers or conferences from divulging any information about a contract or the product it carries.

The U.S. and Canada have, in many areas, the same carriers. If you look at conference carriers, I think there are probably 30 or 35 conference carriers, and I would say probably 70% of them operate out of Canadian ports or handle Canadian cargo out of the U.S. So you're talking largely the same group of carriers.

Mrs. Bev Desjarlais: So they seem to be able to operate under that system without the exemption. That's what I'm getting at.

Mr. Walter Mueller: This is a new provision that has existed for two years and it has been very effective.

When it's suggested that the Canadian regulation is aligned with OSRA, that's not the case, because there is a world of difference between just a service contract and a confidential service contract, if it's prohibited to divulge any information that is in that contract or the transaction it covers.

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Mr. Gilles Bélanger: Business contracts in general are confidential between the parties, if they so desire. If I go and—

Mrs. Bev Desjarlais: Okay. I get the drift. That's what I wanted to clarify. The difference is in the U.S. they must be held confidential. As one party, you can't release it if the other party—

Mr. Gilles Bélanger: I don't necessarily agree.

Mrs. Bev Desjarlais: Well, this is a very serious question related to this whole side, so I think we need to have absolute legal clarification as to whether or not in the U.S. those contracts have to be kept confidential if one party wants it to be kept confidential.

Mr. Gilles Bélanger: I would be pleased to submit supplementary notes on this issue.

The Chair: You're out of time, Bev. A quick intervention by Mr. St. Denis, and then I'm going to go back to Mr. Fitzpatrick for the last question.

Mr. Brent St. Denis (Algoma—Manitoulin, Lib.): Thank you, Mr. Chair.

On Bev's point, as per the routine when we get to clause-by-clause, I think if everyone is in agreement we'll have officials up. I think we can get an absolute clarification that in fact the U.S. system and the Canadian system would be similar when it comes to confidentiality provisions. That's all I want to say for now. We can get that in black and white.

The Chair: Mr. Fitzpatrick, a quick question.

Mr. Brian Fitzpatrick: Yes, just two follow-up questions.

I don't share the enthusiasm of a lot of my colleagues in Parliament here about the effect of regulation and legislation. I think there's a mentality alive in this country—it's quite often misguided—that we have a problem and all we have to do is get the people in Ottawa to pass a mountain of regulations and laws to deal with it. We have a big black book here that is evidence of what we're dealing with here, and we're not even into the regulatory regime, which will add to that. I guess it's based on the premise that if you pass these laws you will get results.

Do you folks know of any monitoring system in place to determine whether this sort of legislation and regulation and so on...? Five years from now can we look at this and say, yes, safety is a lot better now than it was five years ago? Is there anything that you see in this legislation or in Transport Canada that is going to get into the area of monitoring to determine whether we're going to get the results that everybody thinks we're going to get out of this stuff?

Mr. Ron Cartwright: You really touch on a point that's very close to my heart, and that is the first part of my submission that our concern is change for change's sake. We believe strongly that constructive change is good, but it has to be measured. If we could look to this committee to in some way recommend that this kind of measurement takes place, I think we would all benefit from progressive legislation.

Mr. Brian Fitzpatrick: We might even be able to determine what would be suitable for amendment later on or what we should be focusing on.

Mr. Ron Cartwright: Precisely.

Mr. Brian Fitzpatrick: We're just shooting into the dark with a lot of this, with good intentions.

The other point I have here is this. There's a lot in the act about penalties and punishment for not meeting standards and so on. Is there anything in this legislation that rewards shippers who meet and exceed safety standards regularly? Are there any rewards built into this system so that somebody can say there's a reason to be better than what we're regulating and identify those people? We're always great at punishing people with laws, but I quite often think we miss the boat that positive reinforcement works a lot better than negative reinforcement. Where's the reward system or the incentive system?

Mr. Ron Cartwright: Again, speaking on behalf of international operations, I think, yes, there is that award mentality. It is now part of the IMO process. It's part of the port state inspection selectivity of whether an owner and/or a flag state are operating to the international norms and conventions. I believe sincerely that the departments apply that in respect of inspections particularly of port state under the port state.

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So I think it's there, yes, but it may not be profiled in the way you suggest. It would be more beneficial to have positive reinforcement.

The Chair: I will move on to Mario for the last word.

[Translation]

Mr. Mario Laframboise: Thank you.

I just want to make sure I understand correctly. Earlier, Mr. Mueller was saying that Part 15 is a sort of antitrust immunity. As far as I know, even the United States allows conferences. There is no community in the world at the moment that prevents that. If we were to do this, we would be the first country in the world to send out this message. In light of our small market, I think this would be a mistake.

Mr. Gilles Bélanger: That is exactly the position we have adopted. Once our main partners throughout the world eliminate this immunity, we will have no problem if Canada follows suit. But where we do have a problem is that given our small market, if we become a world leader in this area, we are going to loose our market share.

[English]

The Chair: Thank you very much.

Mr. Mueller, Mr. Morrison, Mr. Bélanger, and Mr. Cartwright, we appreciate your input. We had received your briefs previously, and I've read them all. Hopefully, we will consider in our deliberations the matters you have brought before us. Thank you very much for coming.

Members of the committee, we will break for five minutes and then go for an hour. After that we will have lunch before we get into the bill itself.

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The Chair: I'd like to reconvene the meeting.

We have a number of guests. We have Mr. Gould, Ms. McGillivray, Mr. O'Connor, Mr. Currie, Mr. Will, and Mr. Lethbridge. Why don't we go in that rotation? You have five minutes each, lady and gentlemen. So away you go. Stick with your five minutes please.

Ms. Lisa McGillivray (President, Canadian Industrial Transportation Association): Thank you, Mr. Chairman, members of the committee. I'm Lisa McGillivray and I'm the president of the Canadian Industrial Transportation Association.

The Canadian Industrial Transportation Association is a national association of shippers. These are people who buy transportation services from a variety of different modal service providers, including marine. Obviously, as an export nation, our interest in marine liner services is quite acute, and I will address my remarks to part 15 of this bill.

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The CITA is a very strong and supportive member of the Canadian Shippers Council. We have been a member since its inception in the late sixties. Therefore, as you've already had a very good and passionate representation from Mr. Walter Mueller, I will address some of his key points and not repeat the majority of what he said. To more or less streamline CITA's concerns, we're basically reiterating the four key points Mr. Mueller raised.

In the SCEA amendments the shipper community is certainly looking for that assurance of confidentiality in their contracts. I would clarify a certain number of things. In the U.S. they do have anti-trust immunity, that has been retained. But what they have allowed them to do is enter into confidential contracts, which have basically two prongs of key points that we feel are missing in these amendments.

First, the confidentiality is assured through the language of the U.S. legislation, in that the carrier shall not divulge the contents of those contracts. The amendments you have before you say that the liners are not obligated to divulge the contents of the contracts. Perhaps you'd call it splitting hairs, but to us this is a significant difference.

Second, the regulations the U.S. have put in place indicate that the conferences shall not create rules within their cartels, within their structures, that would prevent the member liners from entering into these contracts. Again we're looking for clarification, we're looking for some assurance within the proposed amendments to indicate to the liners that this is a very serious business and there's an expectation that they will begin to move towards free market disciplines.

Third, we're looking for a clarification of the definition of a conference. As Mr. Mueller indicated, there are a number of discussion agreements, stabilization agreements, and different voluntary agreements, and we don't believe these amendments are definitive enough in indicating what is considered in Canada to be a conference and what is not. So we respectfully request that the amendments be modified to ensure that the conference covers anybody who sits around a table and discusses rate and service guidelines amongst themselves. This is price fixing.

Fourth, we've requested that an effective and efficient dispute resolution mechanism be introduced. The one currently in the SCEA legislation is ineffective. In our attempts under a number of different transportation acts to go to the Canadian Transportation Agency, we haven't found that the act is clear enough as to what their powers are and what their enforcement abilities are. So we are asking that a dispute resolution mechanism be introduced into these amendments.

Finally, perhaps one of the most contentious issues in our discussions is to sunset or not to sunset. Certainly from a shipper point of view, the fact that there might be a light at the end of this tunnel is something of great interest. Taking our cue from the comments Minister Collenette made at the very beginning of this process, that he believes the conference system is slowly dissolving, it's something that—and I'm going to paraphrase him—might not even be around in 10 years, our point of view is that putting a sunset clause in specifying a five- to ten-year period would perhaps motivate the carriers to further look at their operations and move towards that free market system, which all industries should operate under in this global economy.

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Before I finish my formal comments and leave for the rest of the speakers, I'd like to point out that in the two years since OSRA was passed in the U.S., two things have happened. First, there have been in excess of 100,000 confidential contracts signed. So obviously shippers there are very interested. Second, we talk about the global economy and how Canada can't step outside the boundaries set by our major trading partners. I can tell you that, as a member of the CSC, and as they are members of the tripartite shippers organization, basically the major continental shipper groups—there's a shippers council in every major trading nation—with almost absolute certainty, it's not the shippers who are holding you back in this regard.

The other thing I would like to point out to you is that very recently, perhaps in the last month, the U.S. Congress has received proposed amendments that would abolish antitrust immunity in the U.S. So certainly they are continuing on this road toward abolishing antitrust immunity, and again I would implore this committee to move Canada very definitively in that same direction.

Thank you very much.

The Chair: Thank you very much, Ms. McGillivray.

Mr. Gould.

Mr. James E. Gould (President, Canadian Maritime Law Association): Thank you, Mr. Chair.

I'm James Gould, president of the Canadian Maritime Law Association. The CMLA has two groups of members, individual and constituent. We have a broad constituency and we are not a lobby group for any particular interest. Our approximately 300 individual members represent all facets of Canadian marine industry, and our 19 constituent members are associations with particular, but varying, interests in maritime matters. You have already heard from three of them, and we'll hear as well from the Canadian Merchant Service Guild during this hour.

The CMLA has been involved in the CSA reform process from the beginning. We've had a committee, of which I was chair at one time. It was a time-consuming task, and one of the few advantages, I think, of becoming president of our organization was that I was able to pass that on to somebody else. So my detailed knowledge of Bill C-14 may not be quite as good as it was of the earlier statutes, but I will do my best.

We commend the Government of Canada for the important policy and legislative initiative taken in revising this statute to reflect current public standards and needs. It has been a very long and complex task. The fact that there has been such a meaningful and ongoing dialogue with government officials on CSA means that many of our earlier express concerns have already been addressed.

We're not in full agreement with all the provisions of the bill, but the most recent meeting held with government officials was just last Thursday, and I think as a result there may well be government amendments that will take care of virtually all our concerns. However, since they're important matters, I'll just speak to them rather briefly.

The first matter is inspection by classification societies and other persons or organizations, as provided in clause 12. That clause permits the Minister of Transport to authorize any person, classification society, or other organization, to issue a Canadian maritime document and to carry out inspections. Subclause 12(5), however, provides that “The person, classification society or other organization is not personally liable for anything they do or omit to do in good faith...”.

Therefore, the bill does not address liability of the crown for the negligence of such independent classification societies or others. The result is that there may be no effective civil remedy against the contractor of the crown for damages arising out of or as a result of their negligence.

We have recommended that the bill provide for this by some appropriate amendment, such as by stating in subclause 12(1) that the classification society or other organization is for such purposes an agent of the crown. I understand that Transport Canada is in substantial agreement with our suggestions and that there may be a government motion for amendment in that regard.

Second, clause 14 provides for the appointment of an authorized representative of every Canadian vessel. The wording has been modified from the previous Bill C-35, but we remain concerned that subclause 14(5), which provides that “The owner of a Canadian vessel is bound by the acts or omissions of their authorized representative”, may make a shipowner liable civilly to persons other than the Government of Canada for all acts of the authorized representative, whether or not that authorized representative has ostensible or actual authority of the owner. We submit it isn't necessary for the regulation of public safety that the bill interfere in what has been to now a private commercial allocation of responsibility as between owners and authorized representatives.

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So we recommend that shipowners be bound by the acts of authorized representatives for regulatory purposes only. As I understand it, there may be a government motion in that regard.

Thirdly, we have some comments on “Investigations” and “Inquiry into Causes of Death”. There are two sections. One is clause 219 and the other is clause 149. The first enables the minister to appoint any person to investigate a shipping casualty. However, a person appointed may not make findings as to causes and contributing factors of the shipping casualty that has been or is being investigated by the Canadian Transportation Accident Investigation and Safety Board.

Clause 149, on the other hand, requires the minister to inquire into the cause of death if a person dies on board a Canadian vessel. We think this may lead to a conflict or a possible conflict with the mandate of the Transportation Safety Board. There's also potential for unnecessary duplication of investigative efforts for deaths on board ships in internal waters, where I would think provincial coroners would have jurisdiction. So we recommend that clause 149 not be mandatory but permissive, so that if the minister is satisfied that a cause of death is being appropriately investigated, he doesn't have to duplicate other inquiries such as coroners' inquests or TSB investigations.

Another matter, which I think was an oversight and I mention it here—I understand it is proposed to be corrected by amendment—is the re-enactment of substantive rights, and in particular the master's lien for necessaries, presently set out in subsection 212(2) of the present Canada Shipping Act, which was not carried forward in Bill C-14 as introduced.

Sometimes a master, particularly of a small vessel, must assume responsibility of ship management and advance payment for fuel, crew costs, repairs, and supplies if the vessel is to continue in service and earn revenue. The master's maritime lien for necessaries is considered necessary by the CMOA, and we propose that clause 86 of Bill C-14 be amended to provide for that.

I should also note that it should be incorporated as well in subclause 226(3), where the minister sells a vessel and the priorities with respect to the fund are set out.

Pollution prevention and response relate to parts 8 and 9 of the bill. The particular concerns here have been addressed in part this morning by Mr. Cartwright, and that is the overlapping of criminal liability. The Criminal Code states that an accused is not liable to be punished more than once for the same offence, regardless of the number of acts of Parliament under which proceedings can be taken, and similar protection exists under section 11 of the charter. Notwithstanding that, water pollution seems to attract prosecution under several different pieces of legislation, and with the Canadian Environmental Protection Act, 1999, the list will lengthen.

At present, in addition to the Canadian Shipping Act, the Arctic Waters Pollution Prevention Act, and section 40 of the Fisheries Act, there is section 13 of the Migratory Birds Convention Act. Transport Canada is charging under the Canada Shipping Act and also under the Migratory Birds Convention Act—charging the master for an offence with which the ship has already been charged.

We don't suggest that prosecutors shouldn't be able to pick whatever act they wish to use, but we do recommend, as did Mr. Cartwright, that the act be amended to provide that priority be given to prosecutions under the Canada Shipping Act, and that where an offence is prosecuted under the Canada Shipping Act, no charges with respect to the subject matter of the offence be laid under any other act.

Finally, I would just say a few words about the enforcement provisions. The principal new enforcement initiative is a scheme of administrative penalties intended to be available as an alternative but not entirely to replace criminal prosecutions. Generally, they would have an option of either prosecuting in the courts in the usual way or assessing administrative penalties in some cases. If the latter course is chosen, then the burden of proof ultimately, according to subclause 232(2), is only a civil burden of proof on a balance of probabilities. We consider this particularly objectionable, as criminal burdens of proof can be avoided if the minister exercises discretion in favour of administrative action.

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We also recognize that the enforcement initiative is controversial within industry. Many of our constituent members have already spoken about it. The Canadian Shipowners Association, the Shipping Federation of Canada, the Company of Master Mariners of Canada, and the Canadian Merchant Service Guild have consistently and strongly asserted that administrative enforcement mechanisms are not needed nor desired by the marine transportation mode in Canada.

So for those reasons we have the concerns about this system, the need for which we don't think has been demonstrated.

I think that's where I'll end my comments. Thanks.

The Chair: Thank you very much for being concise.

Mr. Will.

Mr. Al Will (Executive Director, Ontario Sailing Association): Thank you. Bonjour, Mr. Chairman, honourable members of Parliament, mesdames et messieurs.

Thank you for the opportunity to address my concerns to this committee. I did submit a letter on February 27 after attending the consultative meeting about the proposed transportation appeal tribunal of Canada.

In addition to my role as executive director of the Ontario Sailing Association, I've also been asked to represent the Ontario Boating Forum, of which I am an adviser, and also to represent the Recreational Boating Advisory Council to the Canadian Coast Guard for the Ontario region, of which I'm the vice-chair.

I represent the vast majority of recreational boating organizations in Ontario and most of Canada. I hope you will appreciate my very brief, non-technical approach as a bit of a contrast to the earlier presentations this morning.

The Canada Shipping Act has not seen significant amendment in decades and as a result is outdated and largely ineffective for modern purposes. Most of this act is a very positive step forward. I will only address my one major concern, which is part 11 of the act, the proposed transportation appeal tribunal.

Transport Canada and the coast guard share the responsibility for the act, and it can readily be documented that these two agencies clearly have different agendas and frequently do not communicate. Transport Canada claims the division of responsibility whereby they have common control over commercial vessels and the coast guard for pleasure craft.

In reality, the coast guard provides a bulk of real-world services such as search and rescue, traffic control, pollution response, ice-breaking, and aids to navigation. Transport Canada's role is more administrative in nature. Police agencies share an open and honest relationship with the coast guard. This relationship has resulted in a number of significant safety improvements in legislation within the purview of the coast guard.

In most inland waters, provincial and municipal forces largely carry out police enforcement. At present, all offences under the Canada Shipping Act and most of its regulations are proceeded with via the summary conviction process of the Criminal Code and some regulatory offences are dealt with via the Contraventions Act. Adaptation of the Contraventions Act process is strongly advocated by police agencies as well as all of the stakeholders that I represent, and is wholeheartedly endorsed by these parties.

Establishment of the transportation appeal tribunal of Canada to the marine sector is an affront to the Canadian judicial system being pushed on an unwilling client group. Whereas pleasure crafts outnumber commercial vessels ten to one, the current proposal is to try to apply big-ship rules to little ships with no fleet at Transport Canada to enforce such a proposal.

All statistical data clearly indicates that the most at-risk vessel populations are, in order: pleasure craft, daily living, small commercial vessels, and small passenger-carrying vessels.

When explaining the on-the-water situations it's often practical to equate them to something everyone is familiar with—highway travel. Highways equal our waterways, which share a consortium of user groups. Large tractor trailers equate to our freighters. Buses equal our passenger vessels. Service trucks and taxis are similar to our water taxis, and private cars are our pleasure craft.

One presumes that the police have always had the ability to enforce all laws on all users of the highways or our waterways. Additionally and complementarily, there are also administrative means of ensuring compliance, such as licensing and weigh scales. The latter would equate to some of the administrative roles that Transport Canada has for vessel inspection and licensing. This proposed tribunal would see a new role under Transport Canada to substitute for enforcement of commercial vessels.

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Now let's look at the highway analogy and assume the government determined that police would be restricted to only enforcing laws for passenger cars. All other users, including taxis and tractor trailers, would have no on-the-road enforcement. The only enforcement would be a sporadic inspection process that might take place at the shipping terminal because Transport Canada has no cars. Remember, Transport Canada has no boats. This is precisely the paradigm shift being proposed in this section of the act.

At the Toronto consultation in January everyone in the room, except one person in a room of over forty, agreed that this proposal was a bad idea. Every recreational boating organization expressed opposition to this tribunal. It should be noted that the majority of consultations across Canada were at best not well represented by a broad sector of the user groups, with the exception of Toronto. When I asked the tribunal contact prior to the consultation about invitations to enforcement agencies I was told that they did not think the enforcement representatives would be a meaningful addition to the process.

My recommendation is simple: Proceed with implementing Bill C-14 but delete for the time being part 11.

I have one more brief point to save paper and time, which is that I support all the points that will be submitted by the Canadian Yachting Association with Glenn Lethbridge. I ask you to take particular note of their concerns about oil-handling facilities and the suggestion that this definition be revised to exclude facilities for private or retail sale of marine fuels and lubricants.

Thank you for your attention.

The Chair: Thank you, Mr. Will.

We now move on to Mr. Lethbridge.

Mr. Glenn Lethbridge (Past Vice-President, Recreation, Canadian Yachting Association): Good morning, ladies and gentlemen. My name is Glenn Lethbridge. I am the past vice-president of the recreation division of the Canadian Yachting Association.

It gives me great pleasure to speak to you on behalf of our ten provincial associations, 258 clubs, 52 boating schools, and 31 class associations, in addition to the 60-plus members of the Canadian Safe Boating Council, of which I am the immediate past chair.

It is important to note that the Canadian Coast Guard is a member of the Canadian Safe Boating Council and has abstained from expressing any opinions on these comments on the proposed Bill C-14.

Again, to save time, we concur with the Ontario Sailing Association, Ontario Boating Forum, and the Canadian Marine Manufacturers on their submissions.

We would ask you to review the following definitions in the act, because without amendments they put major restrictions on our members and in some cases would prevent us from carrying on the education of recreational boaters. CYA is a very large training organization, and that's what we do, a lot of us, for a living.

The first one is “bare-boat charter”. This definition reflects the current practice in the marine world. What is left unsaid is Transport Canada's desire to include crewed charters in the commercial category of vessels through regulations. Existing admiralty law practice suggests that the charterer assumes responsibility for the vessel and its operation, no matter whether the vessel is crude or not. A recreational vessel being used for recreational purposes should remain a recreational category, no matter what the charter agreement, just like a very large crewed carrier will continue to meet all regulations for a tanker.

The nature of the charter party agreement does not affect use of the vessel. A recreational vessel remains a recreational vessel. A tanker continues to be a tanker. We would suggest that this definition should be confined to part 1 of the act dealing with the regulations and registration of bare-boat chartered ships.

Enforcement officer: we believe that the definition that appears in part 10, clause 194 should be used throughout the act, as this will ensure that the many small commercial vessels sailing Canadian waters will face an adequate level of enforcement. We suggest the addition of this definition to clause 2.

Oil-handling facility: this is very broadly worded and includes every facility for refuelling small boats at either a marina or a club-type facility. Later sections of the proposed act require operators of prescribed facilities to carry out certain obligations. If it is the intent of the act to encompass these small operators, then there should be consultation with this group as to the impact on their operations. We suggest that this definition be revised to exclude facilities for the private or retail sale of marine fuels and lubricants.

Speaking from Ontario, safety regulations for private storage or retail sale facilities for marine fuels and lubricants is accomplished already through the provincial zoning regulations and statutes under the Gasoline Handling Act.

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We approve of the definition of “passenger” as it relates to “guest on board” and we support the concept presented in paragraph 2(d) that “a person of prescribed class” is not a passenger. From an on-the-water-training point of view, the persons carried should not be considered “passengers”, as this would require the vessels and crews to meet commercial standards. Persons learning to operate a recreational craft are at present trained in recreational craft and recreational boats and should continue to expect to be so.

We approve the definition of “pleasure craft”, especially in conjunction with the definition of “passenger”, but we seek clarification with respect to the phrase “and includes a vessel of a prescribed class”. Elsewhere in the proposed act, vessels of prescribed class are required to have their plans approved and must meet certain criteria under parts 8 and 9. We suggest that the definition be revised to be more specific.

In closing, may I offer the assistance of the CYA and the Canadian Safe Boating Council in the redrafting of these particular definitions. Thank you.

The Chair: You did well, Mr. Lethbridge. Thank you very much.

We move on to Mr. Currie.

Mr. J.A. Currie (Director, Canadian Marine Manufacturers Association): Thank you, Mr. Chairman. Good morning, ladies and gentlemen.

I must apologize. I'm going to do a bit of an on-the-fly edit of my presentation because a number of the topics we would have done on our own have already been brought forward by my colleagues here. There is a complete package of this presentation at the back of the room. Unfortunately, for technical reasons, the French translated version was not available when I left the office this morning, but copies will come up.

I am the executive director of the Canadian Marine Manufacturers Association. We are a not-for-profit organization that was created in 1993. Our 75 members are businesses, both small and large, who manufacture and distribute a wide variety of recreational boating products and services used by Canadian boaters each year. They are located across Canada in small towns and in large metropolitan areas. Some companies have hundreds of employees; others are small owner-operated businesses with as few as two employees.

Our members market boats, motors, engines, personal safety equipment, and fuel systems, just to name a few. Other companies provide wholesale and retail financing, insurance, and even produce consumer and trade magazines for the recreational boating community.

Our goal is to deliver the best possible products to the marketplace, thereby ensuring that recreational boating is fun, safe, and affordable and enjoyed by Canadians wherever they may live.

I'll talk quickly about what the boating business is or means to the economy of Canada. In a recent survey conducted for us by Decima Research, we learned that 19% of Canadian households own at least one boat. Of those households we've polled, we further found that 50% own more than one. In addition, a further 15% of Canadian households told us they would consider making recreational boating a family activity.

Recreational boaters represent the single largest user group of marine services. The coast guard estimates that, in total, we own nearly 2.7 million boats of all types.

Recreational boating has a very significant impact on the Canadian economy. We estimate our community spends in excess of $6.1 billion per year in after-tax dollars. This includes new and used boat purchases, fuel, marina and repair services, and the purchase of after-market accessory products from retailers and marinas as we go boating. This total does not include tourism dollars spent on overnight accommodation and meals while boating. Also, it does not include property, payroll or other taxes and other payments to all levels of government that are paid by various members across the industry.

From an export perspective, we exported, in 1999, 63% of all boats and marine products produced in Canada. It's estimated that the total output—this is an Industry Canada estimate—was just under $1 billion Canadian.

In addition, based on a 1999 estimate, we believe that the federal government is receiving over $91 million per year in GST and excise taxes on the sale of fuel. Provincial governments are receiving an additional $94 million on fuel taxes.

We estimate there are over 300 companies with 6,000 employees manufacturing boats. In addition, there are over 1,500 marinas, service facilities, and boat dealers plus camps, destination marinas, and storefront retailers as well as yacht clubs and training organizations directly employing thousands more Canadians in this industry.

We're vibrant and we're part of the Canadian experience. What we would like to do is ensure that boating continues to be recognized by the federal government in a positive and comprehensive manner for all that it offers our country.

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Now, I have specific comments with regards to the proposed Canada Shipping Act. The recreational boating community wishes to significantly expand the marketplace for our products through an aggressive new marketing strategy called “Discover Boating”. To ensure that our current and future clients can enjoy the sport in a fun and safe manner, we need a renewed and updated Canada Shipping Act, hence our comments on the proposed legislation.

The coast guard recently released a survey indicating that over 85% of Canadians supported the statement that enforcement of safe boating regulations helps make Canada's waterways safer for all boaters. Those CMMA members have a commercial interest in the sport and we are gravely concerned about boating safety. If on-the-water safety is compromised, our clients—and perhaps more importantly, our future clients—may seek alternative forms of recreational activity. This would bring about a serious crisis for our industry and the thousands of Canadians who derive their incomes from it.

There are two significant issues of concern as far as our membership is concerned. First, our clients and their families operate millions of pleasure craft under the jurisdiction of the Canada Shipping Act. In a similar manner, other vessels are also governed by this act. At present, all users of our waterways are governed by the same regulations. The new version of the Canada Shipping Act appears to change this approach in favour of different regulations for different types of vessels. This may be compared to a situation where, in highway driving, regulations are different. Mr. Will has already touched on that—I'm not going to go any further. But it would create a chaotic situation that we would not like to see happen.

We also have concerns—and I think Mr. Lethbridge touched briefly on this—about the move of a significant number of what are now considered pleasure vessels into the commercial category. You could have a canoe in the morning used as a pleasure vessel, and the same canoe in the afternoon could be considered a commercial vessel. Can you imagine the chaos? It's impractical and we would strongly recommend that type of situation not be allowed to take place.

As I said, I'm going to do a bit of an edit here. We are pleased to support the comments made by the Canadian Yachting Association, the Ontario Sailing Association, as well as our colleagues from the Safe Boating Council, the Ontario Boating Forum, and others. However, we do have some specific thoughts on important elements that relate to the industry side of the sport.

Mr. Lethbridge already touched on the issue of oil handling facilities. I have spoken with the other marine industry associations in Canada with regards to the proposal under oil handling facilities and they urge me to urge you to consider excluding yacht clubs and private retailers from those requirements. Generally speaking, I believe this was the case across all ten provinces and the territories. Those facilities are already covered by very comprehensive provincial or regional regulations and the need for further federal regulation is unnecessary. We laud the suggestion of incorporating, by reference, standards into the various construction regulations our manufacturers have to comply with. We think this will allow for a progressive system of small vessel construction regulations and will allow us to move forward and be competitive in the world marketplace.

We also have concerns about the issue of registering a mortgage on a vessel. We'd like to ask that you reconsider the process by which that may be possible. At the present time, it looks as thoughi it will be complicated, whereas at the present time it is quite simple.

Lastly, TP 1332, which is known to us as a small vessel construction regulation, required most vessels to have a capacity or compliance plate fitted before sailing. Failing that, owners must at their own cost refit the boats to comply with the standards, including the swearing of a statutory declaration of compliance. While this is a wonderful policy, there's a serious and fundamental problem associated with these new provisions.

Due to the serious underfunding of the coast guard office of boating safety, this requirement has not been enforced on both domestic and foreign manufacturers. In addition, the slow and inefficient means by which these plates are obtained has frustrated the industry for many years. The resultant effect is that at the present time there are tens of thousands of recreational craft in Canada that are required to have the plates but in fact do not have them fitted.

To now require boat owners to modify their craft up to existing standards or to swear statutory declarations stating compliance with the old regulations is beyond the technical capability of these owners. Canadian boaters should not be penalized in this fashion. CMMA recommends that the existing fleet be grandfathered, thereby permitting all boats constructed before the coming into force of this section to be excluded from the requirement to meet these two provisions.

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Further, we would urge the immediate allocation of additional funding to the Canadian Coast Guard office of boating safety to modernize their evaluation and approval system, and we would request the rewording of the statutory declaration form to allow foreign manufacturers less complicated access to capacity and conformity plates.

In conclusion, we're pleased to have been offered the opportunity to speak to you today. Our members support all initiatives that modernize marine law. However, we feel just as strongly that such improvements must be made in a manner that will not restrict Canadian use and enjoyment of our waterways, nor should any regulations create a situation where employment and the future health of our industry may be jeopardized.

Thank you.

The Chair: Thank you very much, Mr. Currie.

We move on to Mr. O'Connor.

Mr. John O'Connor (Attorney, Canadian Merchant Service Guild): Thank you, Mr. Chairman and members of the committee.

I feel somewhat like our Prime Minister at the recent summit in Quebec City. I'm surrounded by presidents, but I'm not one. My name is John O'Connor. I'm not the president of the Canadian Merchant Service Guild, I'm counsel to the guild, but the president is here, Captain Maury Sjoquist. And certainly would be available to answer any of your questions, should you have them, on policy issues.

The reason I'm here is that we have one point to raise and it is a legal one. It concerns part 11, which is enforcement. First, however,

[Translation]

I would like to say two things. Our presentation is in English because we were rather rushed, but we will be pleased to answer questions in French. In addition, we tabled our report in both languages, if committee members wish to read and study it.

[English]

First, the guild represents the vast majority of what we call certificated seafarers today, masters, chief engineers, officers on board both private and government-owned vessels in Canada. We represent literally all marine pilots, and in all over 5,000 individuals across Canada. Under the new act, we'll be holding what we call a Canadian maritime document, or a CMD, under part 1, clauses 16 to 20. So our members are very interested in the act, especially in the enforcement part.

We consider we're in a unique position to comment on enforcement, because our members are the people who will be making the decisions with regard to navigation, with regard to the deck work that's done on commercial vessels, and with regard to what's done in the engine room. So our people are the front line, making the decisions, and they're going to be the ones facing enforcement issues, if there is to be new enforcement. And Canada is cranking up enforcement under Bill C-14—we should make no mistake about that. We have introduced a huge number of infractions, many more than under the existing legislation, more than are in the United States of America. Not only that, as I'll point out in a minute, many of these issues affect Canadians, but do not affect foreign seafarers on foreign vessels in Canada. So we think it's lopsided.

We would first like to say, however, that we do support in general Bill C-14 and have been involved in all the consultation processes over the last two years. The only point we're bringing forward is to do with enforcement, where we are not in agreement, but certainly we're in agreement with the rest of the bill.

This morning Mr. Fitzpatrick asked a question as to whether someone could be found guilty of an offence even if there hadn't been sufficient evidence that they had done it. Effectively, that's what the new bill gives us. The administrative procedures implemented under the bill will take away what I call charter rights, the right to force the prosecutor, the crown, to make his case beyond a reasonable doubt. The new burden they're putting in the act will be simply a civil burden of balance of probabilities. Obviously that means that someone could be convicted even though there exists a reasonable doubt of his innocence. In our criminal history in this country—I don't care what they do in the States—we have never had that. This is the first time, to my knowledge, that it's coming forward. We do not welcome it in the marine industry. We think it's unfair and goes against our charter protections.

But that's not the only area that goes against our charter protections. We also have clause 238, which imposes vicarious liability upon guild members or upon anyone being charged for things done, even without their knowledge, by people who work for them. So the guild member who is in charge of the deck department, if someone on deck does something he doesn't know about, will, as the Canadian maritime document holder, be accused.

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Our position here is that vicarious liability has no business in the penal or criminal world. Don't forget that the infractions under the Canada Shipping Act will be of a criminal or penal nature.

Furthermore—and this is where Canadians will be more prejudiced than foreigners—a Canadian maritime document, which is the certificate the seafarers will hold, can be cancelled or withdrawn if they have committed an administrative violation, as they call it. In other words, they say to us that the violations are supposed to be minor things, yet if a violation takes place—even through vicarious liability, where the offender is working for the person who holds the CMD—the CMD can be refused or withdrawn under clauses 16 and 20 because of a violation.

Finally on this point, although I believe that the administrative tribunal Mr. Will was referring to is not yet in the act, it is coming. We have had a series of conferences and consultations on this proposed bill, the results of which have not yet been tabled before your Parliament. This bill will even go so far as to take away the obligation upon the tribunal or the adjudicators to apply the rules of evidence. In other words, hearsay evidence will become legal.

So here we could have a man who will be called forward on an administrative penalty. He didn't commit the act that someone is complaining about; it was someone under his control. The case against him will only have to be presented on a balance of probabilities. Not only that, the rules of evidence will not be respected. We suggest that this goes against the charter protections we have now.

We also point out that under clause 236 if you have an administrative penalty it's not to be considered as an offence. We believe that this an attempt to avoid charter protection under section 11 of the charter, which applies to all offences. Are they trying to say here that the charter does not apply? If so, why don't they just say it clearly?

In order to be as brief as possible, I will simply conclude by saying we suggest that clauses 228 to 243, the administrative penalties, be withdrawn from this bill. We do not consider this to be a slap in the face to government. We think they should be withdrawn and should be reconsidered when you're considering this bill. In other words, if you're going to make an administrative appeal tribunal, let's have a debate about administrative penalties. If we want them, let's put it in this bill and do it all together. For the moment we don't need them, and we suggest that the necessity has not been shown.

We also suggest that, alternatively, if you do keep them, clause 232 should be amended to change the balance-of-probabilities test for a beyond-a-reasonable-doubt provision. We also suggest that clauses 16 and 20 be amended to remove any references to violations. An American or foreign seafarer who does the same thing in Canada would not have his maritime document affected; this would apply only to Canadians.

Thank you, Mr. Chairman.

The Chair: Thank you very much, Mr. O'Connor.

We'll move now to rounds of questioning, and we'll start with Mr. Fitzpatrick of the Canadian Alliance.

Mr. Brian Fitzpatrick: I find Mr. O'Connor's comments interesting, and they cause me some concern. We could make our criminal law a lot more efficient in Canada by having the police officer have the power not only to investigate but to lay the charge, prosecute, and adjudicate the matter. It would make it much more efficient, and if there are serious matters at hand here that we are turning over to administrative-type systems—where in essence we're creating this sort of a system—that's very troubling to me, and it should be looked at. It's something not to be dealt with lightly, so I share your concerns.

Mr. Currie made comments about mortgages on pleasure craft. I think it would be totally asinine to get into a federal mortgage system on pleasure craft. The provincial systems for taking security on boats and so on by credit unions, banks, and other financial institutions are very simple and very easy. They work well. There is absolutely no need for the federal government to create another branch of government to get into the mortgage industry along with provincial governments, so I think that's a very good comment.

As to your comments about vicarious liability, I have a lot of problems with that whole concept as well. We use that concept with the enforcement of tobacco laws in this country, and I know store owners who have read the riot act to 16-year-old employees over and over again about not selling tobacco to kids. They fire them when it happens and they've got the signs all posted, but we've got people coming in there who entrap these individuals. Yet they're law-abiding people who are just trying to do their jobs. They just run into people who won't listen to what they're told to do and who get fired, but they end up in court with fairly significant charges and penalties. I think there are a lot of things wrong with that kind of concept, and I don't agree with that concept as a criminal mechanism. It's not fair.

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There is a whole host of questions on pleasure craft that come to bear on this thing. I've driven my motor vehicle for years, taking kids to church things, sporting events, and so on, and to classify such motor vehicles more or less as you would a Greyhound bus could really get to be a problem here. I think we should take a good, careful look at this whole area and at what we're trying to do here.

Where I come from there are a lot of people involved in the outfitting business. They're small-business people and guides and they include a lot of aboriginal people. We're all sensitive about aboriginal people, and there are a lot of aboriginal people who are involved in those sorts of businesses. I'm just afraid that we're going to bring a great big regulatory-type system to bear on this industry. It won't be good for us, so I'm concerned about that.

I'm not exactly sure whether anybody has looked at this issue or not, but I know a lot of pleasure craft people are very upset and concerned about what I think are called jet boats. It seems to me that a lot of accidents happen with those boats. Sometimes I think we should get more focused with our legislation rather than use a shotgun approach and make everybody else pay the price for a particular problem. Is there anything in this legislation that is directed to this whole area of jet boats?

Mr. J.A. Currie: I'll do my best to answer your question, sir.

In layman's terms, the answer is no, there isn't. Although this is not the forum for getting into a controversial discussion about, shall we say, incidents on the water, there is a coast guard study that was conducted a couple of years back.

I notice the gentleman who manages the Office of Boating Safety is here. He could probably give you some details, but basically what the office does, sir, is to go through and analyse incidents on the water. It has concluded that operating a personal watercraft is no more dangerous than operating any other power-driven vessel, both in Canada and the United States. So there are—

Mr. Brian Fitzpatrick: Are there noise pollution provisions in this one?

Mr. J.A. Currie: What you're really talking about in a lot of cases is how the operator handles the vessel and not so much whether there's a fault with the craft. However, if we get into that, we're going to get way off the topic because I don't believe that that's what this forum is for. If you'd like to get some more information on it, the Office of Boating Safety or I will be pleased to help you learn more about that particular issue. However, it's a bit off the radar screen at this committee session.

Mr. Brian Fitzpatrick: But this act and the regulations will impact on that type of—

Mr. J.A. Currie: Well, it will impact on everything.

Mr. Brian Fitzpatrick: —so it's relevant in that sense.

Mr. J.A. Currie: Your good point about aboriginal people and others who are in the outfitting business is exactly on the target. There will be job losses in the outfitting, fly-in fishing, and camping sectors if the proposed legislation goes through as it is right now.

I can't speak specifically for any one particular group there, but I can tell you that my members, who sell boats and engines into that area, are gravely concerned because a lot of these businesses would not be able to afford the upgrades and equipment that the regulations would require. They'll just close up.

Mr. Brian Fitzpatrick: I know they're already dealing with another issue, which is the firearms thing, so this thing coming down the tubes would not be greeted with a lot of enthusiasm in that sector.

Mr. J.A. Currie: Perhaps, but I can't speak for the outfitters' association. They'll have to make their own representation.

Mr. Brian Fitzpatrick: As to the manufacturing requirements and so on, I presume you're referring to the Canadian Standards Association, ISO, and that sort of—

Mr. J.A. Currie: The Office of Boating Safety administers a document that's known in the industry as 1332, which is the Canadian small-vessel construction regulations. This was in fact updated about 18 months ago, so we have a new set of rules that are considerably more modern than the previous set.

The reference by Bill C-14 to permit what is called “incorporation by reference” allows them to modernize those standards on a continuous basis by bringing in outside standards that have been developed by credible organizations—not necessarily Canadian. If the standards are deemed to be applicable here, then this will speed up the process of refreshing the regulations and allow for the boats that are being built, both in Canada and outside Canada, to be safer and safer as we go along.

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I should say that we actually have this situation in place now for personal watercraft. Canada was actually, globally, the first country in the world to adopt the ISO standard for personal watercraft as a means for attesting to the fact that personal watercraft meet or exceed the Canadian small vessel construction regulations. Without that, the product wouldn't be able to comply.

We actually set a precedent by being able to come to that agreement with the coast guard and the board of steamship inspectors some time ago. As a matter of fact, I think Captain Lanteigne was on that board at that time. I don't recall, but I believe you were, Réjean. We made history, in a way, by being able to do that.

Mr. Brian Fitzpatrick: With that sort of system in place, do we really need standards from the government, or can—

Mr. J.A. Currie: Yes, sir, we do. But what we need to do is make it simpler for boat manufacturers to go through the process.

To give you an example, the statutory declaration form requires that it be signed by—you have to follow me here for a second—a Canadian citizen, resident in the country, as in living in Canada, who is an officer of a corporation. Over half the boats sold in this country are manufactured outside Canada. Keeping in mind the criteria for who that person has to be, in most cases those people don't exist, which means that even though the product they're trying to import into this country meets or exceeds our requirements, they cannot sign the form and coast guard can't sell them the plates. There are thousands and thousands of boats like that.

Companies do find ways to comply, but it's costly, it's time consuming, and it's really inefficient. We need to get a little bit wiser in how we handle this, and we'll improve the business of the industry and at the same time we'll cut down on the workload that the Office of Boating Safety staff have to deal with.

Just to give you an idea, there are two people in the Office of Boating Safety who do all of the technical evaluation work on every single boat model that's sold in this country. They also have to process the plates for between 65,000 and 100,000 boats a year. Two people!

It's a paper process, and I can tell you that they're drowning in paper. The process takes anywhere from four weeks to six to eight months in some cases, although that's the extreme. It generally takes four to maybe twelve weeks for the documents to get pushed through the system. It's holding up trade, whether it's Canadian domestic trade, or whether it's Canadian trade going outside the country, or whether it's U.S. or foreign-based product coming in here. It's a huge roadblock and we have to do something about it. Giving the coast guard more money and sharpening up some of these processes, which you can deal with by making some small changes to Bill C-14, will really speed up the process and make it a lot easier.

The Chair: Brian, are you through?

Mr. Brian Fitzpatrick: Yes, I think so. I might have one question toward the end, but I want to think about it before I ask it.

The Chair: I'll go to Mr. Shepherd of the Liberal Party.

Mr. Alex Shepherd (Durham, Lib.): I was interested, Mr. Currie, in some of your comments. In your introduction you talked about the concern for safety on the waterways, and that your industry would be in dire straits, if I can use that terminology, if in fact you didn't deal with that issue. But in your concluding comments you ask that a number of existing vessels be exempted from safety provisions of this act. Can you square that—

Mr. J.A. Currie: I'm not asking for them to be exempted. What I'm saying is the problem—and I outlined it slightly when we were answering the question for the other gentleman—is that all boats are supposed to be built to 1332. The elements of 1332 that are applicable vary depending on the type of boat. For the sake of argument, let's just pick a 14-foot, open aluminum boat that's going to have a 10-horsepower motor. There's a set of specific requirements that boat must be built to, which include stability, flotation, and various other things, such as how high the transom is above the water and so forth. The matter at hand is that because of the problems with getting plates, there are lots of companies who say, “You know what? I'm not even going to bother sending my technical data in. I'm just going to build the darn boat and put it on the market.”

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Some of those guys are building those boats in compliance with the regulations, but they're just not bothering to fill out the reams of paper and send them in to the coast guard. So they are good citizens. There are other companies—and these are not just Canadian, these are businesses building boats—who are in fact saying, “You know what? The boat over there that Mr. Fitzpatrick has built is a wonderful little boat, and I'd like to put one on the market, but I don't have the time to engineer it. So I'm going to buy one of his boats and I'm going to flip it, which basically means I'm going to copy it.”

Mr. Fitzpatrick, I'm sorry to use you as an example, sir.

Mr. Brian Fitzpatrick: It's okay.

Mr. J.A. Currie: Mr. Fitzpatrick built the boat in good faith, but the guy who's going to flip it has no engineering department, he doesn't do any detective work, he just assumes that Mr. Fitzpatrick did the work. He doesn't dare take his boat and measure it up and send that information to the coast guard, because he would obviously probably find that he's well short of the mark. So the issue is that all those boats are now in the marketplace. The boats have been on the marketplace for quite a long time. They may have changed hands. What I'm saying is you cannot make the current owner responsible for prior actions of the builder or maybe the various people who have bought the boat all along the way before it got to this person's hands, which is what you'd be requiring here.

So we're not saying any boat should be excluded from the regulations. All we're saying is don't force the owners of these, dare I say, hundreds of thousands of boats out there that don't have the plates to be responsible at this point for upgrading their boat to the current standard. Recognize that there's a problem, and say we're going to draw a line across the page and we're going to say it stops right now and we're going to speed up the process, make the plates more accessible and the manufacturers will be lining up to buy the plates.

It costs the manufacturer anywhere from $25 to $35 per plate to put the plate on a boat. That sounds like a lot of money, but the actual tag itself costs about five bucks from the coast guard, plus GST. But they have to do the engineering work, they have to submit data on every single model, they have to buy these plates that are unique by model, they have to store them, they have to make sure there's a production that runs through the shop, they have to get the right sticker on the right boat, and it goes on and on and on. So you're probably looking at, as I say, anywhere from $25 to $35 a boat to put a plate on it.

Mr. Alex Shepherd: It's not clear to me what you're saying. Are you saying that there's a huge inventory of boats out there that are significantly under the current standards? Or are you saying that there's a bunch of boats out there for which the difficulty of registering them and getting the plates is prohibitive, due to their history?

Mr. J.A. Currie: That's what I'm saying. There are boats out there that don't have plates because the process of getting the plates is cumbersome. And if you pass the bill the way you've proposed it, you'll put the onus on the owners of all those boats to upgrade to the current standard and then have to go and get a plate. They can't do it.

Mr. Alex Shepherd: I'm confused, because you keep using the word “upgrade”. My idea of “upgrade” is they have to do something to the boat to bring it into compliance.

Mr. J.A. Currie: They might have to, because all of a sudden you're saying in the year 2001 here are our small vessel construction standard regulations. But a boat built in 1985 was probably built to the standard that was in effect then. So you're asking the guy who bought the boat in 1986 to update the boat to 2001 standards and then go and apply for a plate from the coast guard. It's not practical.

Mr. Alex Shepherd: I have one final question on that issue. Is it conceivable that people just couldn't do it? From an engineering point of view, if you're saying that we should be so many inches above the waterline, clearly, if a boat was built with less than those standards, it's impossible to change the boat—I suppose it's not impossible, but nearly impossible—as opposed to simply putting a couple more flotation devices or something on the boat that would bring it up to safety standards.

Mr. J.A. Currie: Adding a PFD to a boat is not going to necessarily solve the problem, but you're absolutely right otherwise. Let's say you have to adjust the transom height of Mr. Fitzpatrick's 14-foot aluminum boat. You've had the boat for ten years, and the cost of doing that might be $1,000. You may say you're not going to do it, so you stop.

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The Chair: Mr. St. Denis, Mr. Shepherd has a couple of minutes. Did you want to...?

Mr. Brent St. Denis: No.

The Chair: All right, we'll move to Monsieur Laframboise.

[Translation]

Mr. Mario Laframboise: Thank you, Mr. Chairman.

My first question, Ms. McGillivray, is about Part 15. You say that some changes were made in the United States in 1998. Clearly, the antitrust immunity was not abolished. This is before the American Senate. So this is being talked about in the United States. Finally, the industry has told us that Canada does not want to be the first country to adopt this standard that would eliminate the antitrust immunity. That's what we were told earlier. The representatives told us that they did not want to be the first Country to abolish the current standards applied by all communities throughout the world. Therefore, I have trouble understanding why we would want that, given that Canada is not a dangerous competitor. Rather, we could be swallowed up by the industry if we are not able to compete. That is my problem, Ms. McGillivray.

Clearly, given that Canada is not a major market nor a major competitor, I do not think that it can afford to have legislation that would make it less competitive at this time. Of course, when the Americans amend their legislation, we will do so as well. You say in your statement that you were hopeful that the Senate would make these legislative changes. However, you do not trust what Mr. Collenette says. Sometimes I too distrust the minister, but the fact remains that the proposal in Part 15 seems acceptable and reasonable. But I do have trouble understanding your position. Can you shed any light on this for me?

[English]

Ms. Lisa McGillivray: Certainly, yes, it is the position of the CITA, as well as the Canadian Shippers Council, that ultimately we would like to see the Shipping Conferences Exemption Act abolished. However, due to the persuasive arguments of the Minister of Transport and differing administrations, we have become somewhat resigned that we are going to take this step-by-step approach.

Where our issues arise for the most part in dealing with the proposed amendments to the Shipping Conferences Exemption Act is that in our view the proposed amendments will not bring us to the same point that American shippers enjoy today. What we have proposed as our modification to the amendments would, in our viewpoint, bring us up to where the U.S. is.

Where we are proposing that perhaps Canada be bold is with the implementation of the sunset clause. In our proposal, we suggested five years; Transport Canada suggested ten years. Sure we'll take it. We are saying in ten years the SCEA should be abolished. We are giving the marine lines ten years to make the necessary changes in their operations so that they can enjoy the same market disciplines that their customers enjoy.

[Translation]

Mr. Mario Laframboise: Thank you.

Obviously, Mr. Will and Mr. Currie, I have problems. Part 10 applies to pleasure craft, whereas Part 11 applies to commercial craft. That is how I interpreted the documents. In your brief and your comments you are saying that Part 11 should not apply to pleasure craft, if I understand well, or there is a part of Part 11 that applies to pleasure craft but that there are not enough staff to enforce it.

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I see from the texts that there are in fact recommendations and regulations, but that this will still be done through Order in Council or amendments. Thus, this will be gradual. There is nothing in there that will cause serious problems tomorrow morning. I agree with you that there is not enough staff to enforce the law if all of the regulations contained in this bill were to be applied immediately.

Take the example of clause 207, which refers to clause 201, in which it is specified:

201. Every operator of a pleasure craft shall ensure that it meets the requirements of the regulations made under this part.

Clause 207 which deals with regulations, states this:

207.(1) The Governor in Council may, on the recommendation of the Minister, make regulations respecting pleasure craft licensing [...]

Thus, enforcement will be done gradually. I find it hard to believe that Transport Canada... If you are telling me that all of this applies today and that the department has not foreseen the required staff to issue the required authorizations, then I would agree with you. I think however—and I will ask this question later to department officials—that the application will be gradual, which should allow Canadian public servants to fulfil these responsibilities.

Lastly, with respect to pleasure craft, I do not believe, nor have I ever believed, that there will be a proliferation of the Canadian Coast Guard in all lakes and streams throughout Quebec or Canada. I know that a part of this legislation will be enforced by police forces and I think that there will also be adjustments to be made accordingly.

However, as provided for in clause 197 of this bill, every manufacturer, builder and importer of a pleasure craft shall ensure that the license plate or label be displayed directly on the craft. Obviously, this is what we would expect. New regulations are being passed and they will apply immediately. They apply to the dealers, the manufacturers, the builders and the importers. You say that if you are to build them, there would not be enough staff to issue the required permits. I agree with you on this. It's true, the department has a problem and they will have to hire more staff, but I do not understand your position when you state that some part of Part 11 should not apply to pleasure craft. That seems to be your message. It will apply to commercial craft.

With respect to safety, we, elected officials, are not in the position to judge this.

Mr. Will.

[English]

Mr. Al Will: If I can continue with a bit of an analogy, if you go out boating on the river between Ottawa and Hull and there are two identical 16-foot fibreglass boats, one of them is a pleasure craft, and one is a water taxi, and in this situation the boats collide, under this implementation the police have no authority over the commercial craft. How are you going to adjudicate this action? Because the police or enforcement agency only have control over the pleasure craft, the person who is operating the same vessel but as a pleasure craft.

Why I say to delay it at this time is because I think the implications are so great that it will slow down the act and the implementation.

Mr. J.A. Currie: I want to add to that a couple of thoughts.

You touched on the plate issue again. The manufacturers want to see plates on all boats, certainly on all boats that are required to have plates. The issue at hand is not to suggest that we're asking that part 11 be struck down. What we're asking is that on the issue of plates, the process of acquiring the plates, the means by which the documents are signed by the various builders, be improved to a point where it's actually workable, where it's practical for the manufacturers to obtain the plates in a timely manner.

You also talked about the issue of licensing. I didn't really want to go there, but you gave me the opportunity, so I thought I would respond or comment on that.

The small-vessel licensing system in this country is a mess. It is not electronic. It is essentially a bunch of boxes in customs offices across the country. It is extremely difficult and in a lot of cases impossible for an enforcement officer to locate not necessarily the owner of the boat but at least the person who was present when the licence form was filled out. That is because the system is not computerized. It doesn't interface with police computer systems. Quite frankly, it's very archaic and it's in desperate need of modernization.

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It's wonderful; in clause 202, there's an issue regarding the issuing of pleasure craft licences. Those are great words, but at this point it's useless rhetoric. What we need is a system that actually works, not a system under which I go into a customs office in Oakville, Ontario, today and fill out a form and see that the Customs office copy of the form goes in a box in the corner, to be found, maybe, when the customs officer trips over it in six months' time. We need a workable system. I'm not talking about gun registration here. We have a paper system. Provide for some provision for the modernization of the existing system. This is not a new deal.

As boaters, we don't mind having licence numbers on our boats. It might help somebody return it to us if it drifts away from the dock. It might help somebody return it to us if the boat gets stolen. It may help in a search and rescue situation by being able to identify where the boat came from and give a police officer the opportunity to make a phone call so that he knows that when the boat is found on the beach, gee, all it did was come loose from its mooring and they don't have to call out the National Defence guys in a Labrador helicopter to go look for a body that was never in the boat in the first place. Those are all circumstances that happen, so we need to fix that.

The Chair: We're out of time, so I'll go briefly to Mr. St. Denis, then come back to Ms. Desjarlais, and I know Mr. Fitzpatrick has some questions.

Mr. Brent St. Denis: Thank you, Mr. Chairman. I'm just going to take a couple of minutes, not to ask questions, as I'll make sure the opposition has their full time, but just to take the opportunity to clarify some of the comments that have been made, as we are winding up with our witnesses today, and maybe put on record some corrections. Whether we get to clause-by-clause today or not, we're in your hands. But whenever we do get to it, no doubt we'll have the officials from the department who can add to my brief comments here.

I thought if I could, for the record, I would indicate that when it comes to—and I'm not referring to any particular witnesses, but some comments refer to the first set of witnesses—the safeguards through due process and the development of guidelines that ensure that power is provided for the act to be applied fairly and consistently, the minister in his introduction to the bill noted that the act is intended to be enabling legislation. He noted that the open, consultative processes that were used to develop the bill would continue to be used to develop the regulations necessary to fully reform shipping laws in Canada. The department is committed to working with all parties to ensure that necessary processes and procedures are fair in accordance with administrative and common law.

We'll note that there will be several government-sponsored amendments at clause-by-clause stage, which we'll deal with. Many of the comments Mr. Gould raised in his intervention—I'm not certain if every one is there, Mr. Gould, I didn't itemize them, but certainly a significant number of them are included.

There's been some discussion about the administrative versus judicial approaches to dealing with people breaking the law at either a major or a minor level. I think the idea behind an administrative system is for the lower level of infraction to try to speed...without referring everything to the courts. We're trying, as government at all levels, to steer minor infractions away from the courts so we don't clog up the courts.

So the administrative procedure is not any attempt to get it on the Charter of Rights. In fact, in a comment to Mr. O'Connor, the Department of Justice has vetted the administrative procedures and it has passed the test when it comes to the Charter of Rights. I'll let the officials discuss some of the more legal attributes there.

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When it comes to comments made by those involved with the recreational community, and we appreciate their participation today, but much of the discussion was irrelevant to the bill, including the fact that there is no.... Whether somebody imagines that there may be a tribunal sometime in the future, that's up to them to decide whether they want to see that as a possibility, but this bill does not propose to create a transportation tribunal, nor are there plans to apply part 11, the administrative scheme, to pleasure boats. Where pleasure boats are used commercially, that's another matter, but pleasure boats used for pleasure would not fall under this scheme. So I'm not sure where the misunderstandings, if any, have come from.

Under the SCEA, the Shipping Conferences Exemption Act, some comments were made that the U.S.... I think Mr. Mueller said the U.S. system is vastly different from what is proposed here. In fact, what is proposed under this legislation is very similar to the U.S. system, and I would refer Ms. McGillivray to the U.S. legislation itself, which provides for confidentiality, virtually the same thing as is proposed in this legislation. I can give her a copy of the relevant sections of the act if she wishes to have that. I'm not sure Mr. Mueller is still here, but I would give him a copy of that as well.

I'm not sure if the government has heard any new suggestions today from the witnesses that didn't come up during consultations. I trust that all the witnesses here did raise these things during the consultations so that the amendments the government proposes to make, which we'll do at clause-by-clause—about a dozen, give or take—are our best efforts to respond to some concerns. But I don't want to leave the witnesses with any illusions that many of their comments will or can be reflected in the bill, their comments having been taken quite sincerely through the consultation process.

I think Mr. Currie made reference to the loss of jobs in the outfitter business. I'm from northern Ontario and I haven't heard from any outfitters in my riding. I'd like to see him provide some documentation where somewhere the Canada Shipping Act will create the loss of jobs in lakes in my riding of Algoma—Manitoulin, with great respect, Mr. Currie.

I'll leave any further comments to the clause-by-clause stage, Mr. Chair, to make sure we pass back to the opposition members.

The Chair: I move to Mrs. Desjarlais.

Mrs. Bev Desjarlais: Mr. Lethbridge, your comments on wanting the oil handling facilities of smaller retailers not included...why so?

Mr. Glenn Lethbridge: If you know oil handling facilities under the existing legislation, there are requirements under them for some very onerous responsibilities. In this particular case you're talking about such a small quantity of material. For instance, in the Great Lakes, you have to have a signed agreement with a cooperative to pay a per tonne fee for the oil product, and it's too onerous for a small marina that sells fuel at the end of a lake. They already fall under legislation in Ontario, under the oil handling act.

Mrs. Bev Desjarlais: But I still don't understand by the regulations here exactly how that will hinder them. What serious hindrance is it to them? Is it overly costly?

Mr. Glenn Lethbridge: It's very costly.

Mrs. Bev Desjarlais: When you say “very costly”, how very costly?

Mr. Glenn Lethbridge: I can't give you an exact amount, unfortunately.

Mrs. Bev Desjarlais: Roughly.

Mr. Glenn Lethbridge: I guess we'd have to ask some of the people here who already have some of their membership from the commercial side when they are deemed an oil handling facility. It's a per tonne fee that you pay.

Mrs. Bev Desjarlais: But if they're a small operation, I would assume it's not going to be that huge a fee.

Mr. Glenn Lethbridge: It also requires them to have an operations plan, which generally means hiring a consultant to do that for them. It's a long process for something of such a minor size. Those are based on the loss of product in the 10,000-tonne range, which is a huge oil spill. We're talking small quantities.

Mrs. Bev Desjarlais: Should the legislation give a limit to, if this operation has this much, they're covered, or if they fall under that limit, then they don't fall under this legislation? Is it more—

Mr. Glenn Lethbridge: That's probably a simple way of doing it.

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Mrs. Bev Desjarlais: Okay.

I recognize the comments you're making, Mr. Currie, on boats that have been made that just don't have the tag, but they're safe and everything. I try to put that in the perspective of other operations, such as years of problems with motor vehicles being put on the road that had been modified or weren't kept safe. There were a lot of accidents as a result, so there were safety programs put in place. I believe most used vehicles have to have a safety check within a period of time. I would hazard a guess that there are far fewer boats out there than there are cars on the road, and yet we have a safetying process in place for them. So I recognize your point that we need to have a smoother transition, but I find it hard to accept that we wouldn't have some kind of process whereby a homemade boat or any kind of boat that's been modified had to meet certain regulations.

Mr. J.A. Currie: You're right, but the point is that though the process is there, it doesn't work. If you passed a regulation that a boat built 20 years ago had to be brought up to today's standards from an engineering point of view, it might not be possible. It is likely not affordable, and who would do it? More importantly, how would you ever figure out that somebody needs to do it? There are 2.7 million boats around and they're not all readily visible to the naked eye. They're under cottages, they're tied up to docks. I wish we had someone here from the OPP or the RCMP who does marine policing and could tell you. I can tell you personally that where my cottage is, up north of Toronto, we have an OPP boat on the water one day a summer. Even if those guys tried to inspect every single boat, they'd be there for a month.

Mrs. Bev Desjarlais: In Ontario do the boats have to be licensed or registered with the province?

Mr. J.A. Currie: No. Federal regulation requires that a boat equipped with an engine in excess of 9.9 horsepower be licensed, in simple terms. So I have a 14-foot aluminium boat with a 15-horsepower motor, and I have to go to Canada Customs with some information. I provide that information to Canada Customs. They issue me a licence. That information comes out to me in the form of a piece of paper. I take it to the local sign guy. He makes me up some numbers and I stick them on the boat. There are, I believe, three or four copies of the form. I get a copy. One is kept in the customs office. One, I believe, is returned to the coast guard, or is stored and eventually perhaps returned to the coast guard. From what I understand, there's a warehouse here in Toronto full of boxes of these things.

I don't know if you're a boater, but if you are, you'll know that their licence number starts off, for example, in Montreal with 10D. The first three characters identify the customs office that issued that licence. I have a boat I bought from a dealer in Gananoque. I used to live in Montreal. If you were an OPP guy, you would have to know that 36E, or whatever it is, is Gananoque. Then you'd have to phone the Canada Customs office in Gananoque and find out if it still exists, and if so, if they have the records. We need it computerized. If you do find it, you'll find the damn document's got my Montreal address on it, and I live in Oakville, Ontario. But the boat is up near Gravenhurst, Ontario, so how could a police officer ever figure out, if they find it out in the middle of a lake, whether there were people in it, who to phone, who to return it to?

Mrs. Bev Desjarlais: So in other words, by putting it under the Canada Shipping Act, we're creating absolute chaos—

Mr. J.A. Currie: It's already there. Just find a way to encourage.... A computerization of the existing system would be absolutely perfect. Then a policeman in his car at the end of a dock could punch the numbers into his little computer and through the wizardry of technology find out that this boat belonged to me or belonged to Al.

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He could maybe get a telephone number and phone the house and say they just found this boat on Lac Deschênes, and I would go, “Damn, that knot on the dock let it loose again”. Nobody would have to go looking for anything. They'd just have to tell me where the boat is, and I'd go fetch it.

Mrs. Bev Desjarlais: Mr. St. Denis commented on the situation related to the OSRA regulations, and he gave me a copy of them. I read through them, but I'm still not convinced that Canada's regulations and these are the same. I know there are highlighted sections.

I just want to get a clarification from Ms. McGillivray. Under OSRA it says that:

No common carrier, either alone or in conjunction with any other person, directly or indirectly, may knowingly disclose, offer, solicit, or receive any information concerning the nature, kind, quantity, destination, consignee, or routing of any property tendered or delivered to a common carrier without the consent of the shipper or the consignee if that information may be used to the detriment or prejudice of the shipper or consignee, may improperly disclose its business transaction to a competitor, or may be used to the detriment or prejudice of any common carrier.

Do you have a copy of this, by any chance?

Ms. Lisa McGillivray: No, not that one.

Mrs. Bev Desjarlais: Another highlighted section farther down says:

Nor shall it be prohibited for any ocean common carrier that is a party to a conference agreement approved under this Act...to give information to the conference...or to prevent the conference...from soliciting or receiving information for the purpose of determining whether a shipper or consignee has breached an agreement with the conference...

—That's the highlighted section, but the section that isn't highlighted says:

...or its member lines or for the purpose of determining whether a member of the conference has breached the conference agreement, or for the purpose of compiling statistics of cargo movement, but the use of such information for any other purpose prohibited by this Act or any other Act is prohibited.

In my estimation the U.S. regulations are stronger by saying you can't give that information unless it's just to track statistical cargo movement. I think it's wordy enough and convoluted enough that we need to be sure exactly where our legislation comes into it.

Do you have any comments on that?

The Chair: Thanks, Bev.

You have about a minute and a half to respond. I think we're probably going to hear from a battery of lawyers, and I'm not too sure they'll agree. But you do have a minute and a half, and I will give you the time.

I'm hoping to have the clause-by-clause consideration done on next Tuesday, May 1, if the committee agrees after we conclude here, and that will give you some time to check your stuff out. I'm sure you don't have enough time to get all that information, but you have part of it now, and I'll give you a minute and a half to get a response from our guest.

Ms. Lisa McGillivray: I'll try to take less than a minute and a half.

I think what you just read out, Ms. Desjarlais, is more or less what I said in my brief. We think that the basics are there in the Canadian legislation. Where we're again getting a little bit controversial and contradicting one another is in the language. There's a big difference between “is not obligated” and “may not”. One says no, you can't, and the other one says you can think about it, and if you want to, go ahead. That's our issue.

The second part you read said that they can't make rules among themselves prohibiting confidential contracts. What we're saying is that the Canadian legislation is somewhat lacking in that regard.

I hope that helps clarify that issue for you from our perspective.

Mrs. Bev Desjarlais: Thank you.

The Chair: Thank you very much. I'll give you a chance, Bev, if you want to bring in an amendment next Tuesday.

Mr. Fitzpatrick, you'll have the last word for our guests.

Mr. Brian Fitzpatrick: On the outfitters and guides, I think the problem we're going to find in this area is that they're not aware of this legislation. That would be my initial reaction. Once they do find out about it, we had better get some earmuffs.

I'm sort of surprised. In that part about standards, I read that it could be retroactive. I have an old 1986 Toyota sitting at home, which we use as a runabout. I'm sure it doesn't meet 2001 automotive standards, but we don't make these things retroactive in their effect. You let the existing ones go through. I think the wording of that particular part should be looked at. I don't think the intent is to be retroactive, but I think enforcement people could interpret it that way.

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What I don't know is whether the resources, the processes, and the personnel are there to put this law in place. It's easy to pass laws, to dictate results, and to come up with regulations, but for a lot of laws to be effective and so on, you need the people out in the field to enforce them and to make them work. If they aren't there, what are we looking at in terms of enforcement people? People say that the Ontario Provincial Police aren't in our jurisdiction, but quite often federal people pass laws that people at the provincial level are expected to enforce. You see it all the time. In our area it's the RCMP that does it, but the RCMP has lots of things to do under its Criminal Code provisions alone without jumping into this area. I am just curious from the industry standpoint. Do you think the resources, the process, and the personnel are in place to make this regime work?

Mr. J.A. Currie: I think Glenn wants to speak, but I'll just give you a one-word answer: no.

The Chair: You have about three minutes to finish.

Mr. Glenn Lethbridge: With regard to the guides, a gentleman, whose name I did not get, mentioned the part that's missed. I tried to talk about the definitions. If a definition under this act is taken into account for a guide, then it becomes a commercial vessel. That guide would have to follow commercial standards, and the vessel they're on would not be able to abide by commercial regulations. Also, that guide is going to have to become a coast guard captain or limited, which is impossible for them. So it depends on how you interpret the definitions in there, because the existing ones very clearly make reference to their being a commercial vessel. When you do that, if you look at northern Ontario, the OPP will not be able to look after an incident because it's a commercial vessel, and that will fall under Transport Canada's domain.

Mr. Brian Fitzpatrick: I have just one comment to make before I leave so that I am on the record, too. When we create laws like this, I want to know how much they are going to cost. Before this thing is over I want to have clear estimates as to what the enforcement costs are going to be. To inspect, enforce, and license all of these pleasure crafts across the country, what kind of costs are we looking at? I hope I can get that information at some point.

The Chair: Thank you, lady and gentlemen.

For the committee, is it agreed that on Tuesday, May 1, we will start the clause-by-clause consideration of Bill C-14?

Some hon. members: Agreed.

The Chair: So it is agreed.

We will meet again next Thursday at the regular time of 11 o'clock, at which time we will hear from the Minister of Public Works and Government Services.

The meeting is adjourned until Thursday.