The Supreme Court of Canada’s ruling against the Impact Assessment Act, famously dubbed “the no more pipelines act” by former Alberta Premier Jason Kenney, now forces the federal government to overhaul its 2019 legislation.
The legislation, known as Bill C-69 before it became law, was introduced by the Liberal government to give Ottawa the power to evaluate major infrastructure projects, such as major pipeline projects and new mines.
Timeline
Back in 2012, the Harper Conservatives streamlined the approval process for energy projects with the Canadian Environmental Assessment Act. The Liberal government sought a more rigorous process in Bill C-69, the Impact Assessment Act (IAA), and overhauled how major infrastructure projects were reviewed and approved.The bill replaced the National Energy Board with a new Canadian Energy Regulator and an altered federal environmental assessments process to include a broad range of impacts to be reviewed by a new Impact Assessment Agency.
The bill was introduced on Feb. 8, 2018 in the House of Commons, and passed House and Senate votes on June 20, 2019, receiving royal assent the next day.
The Canadian Association of Petroleum Producers warned the legislation could drive away investment, while Mr. Kenney, who was premier of Alberta at the time, said it would create delays and uncertainty around project development.
Provincial Opposition
The province of Alberta challenged the legislation in a reference question to the Alberta Court of Appeal filed Sept. 9, 2019. On May 10, 2022, Chief Justice Fraser and three others ruled the federal government had gone beyond its authority, while Justice Greckol dissented. The majority decision called Bill C-69 “a breathtaking pre-emption of provincial legislative authority” over resources.The court ruled just because an interprovincial project may have adverse effects on areas that fall under federal jurisdiction, that did not mean the federal government had the right to regulate the project from beginning to end. Parliamentary jurisdiction was limited to the environmental effects.
Even here, the court found the government had stretched the definition of a “federal adverse effect,” saying that “while those changes or impacts may be ‘effects within federal jurisdiction’ for purposes of the Act, that does not make all of them effects within federal jurisdiction for purposes of the division of powers.”
The Supreme Court of Canada granted its notice of appeal June 8, 2022 and held public hearings in March of 2023.
Supreme Court Decision
In writing the Oct. 13 majority decision of the Supreme Court of Canada’s decision on the legislation, Chief Justice Richard Wagner said the law in its current format could regulate activities that are under provincial jurisdiction.“Even if this court were to accept Canada’s submission that the defined ‘effects within federal jurisdiction’ are within federal jurisdiction, these effects do not drive the scheme’s decision-making powers,” he wrote.
However, Mr. Wagner noted that Ottawa has a legitimate role over environmental issues, and that provinces must work within its rules.
“The fact that a project involves activities primarily regulated by provincial legislatures does not create an enclave of exclusivity. Even a ‘provincial’ project may cause effects in respect of which the federal government can properly legislate,” Mr. Wagner said.
“Environmental protection remains one of today’s most pressing challenges, and Parliament has the power to enact a scheme of environmental assessment to meet this challenge, but Parliament also has the duty to act within the enduring division of powers framework laid out in the Constitution.”
What’s Next
Following the court’s decision, Alberta Premier Danielle Smith took to social media to declare, “Alberta wins! Canada wins!” In a joint statement with Justice Minister Mickey Amery, she wrote, “The ruling today represents an opportunity for all provinces to stop that bleeding [of jobs and investment caused by Bill C-69] and begin the process of reattracting those investments and jobs into our economies.”Saskatchewan Premier Scott Moe said on Oct. 13, “This should cause the federal government to rethink the many other areas where it is overstepping its constitutional competence, like electrical generation and oil and gas production.”
Environment Minister Steven Guilbeault and Natural Resources Minister Jonathan Wilkinson emphasized that the IAA has not been struck down by the court and was salvageable.
“We’re not talking about rewriting the act. We’re talking here about surgical intervention to further define certain elements of it,” Mr. Guilbeault said at a press conference on Oct. 13.
In a joint statement, Guilbeault and Justice Minister Arif Virani wrote that the government developed the IAA “to create a better set of rules that respect the environment, Indigenous rights and ensure projects get assessed in a timely way.”
“We remain committed to these principles,” the statement said. “We are heartened that the Supreme Court of Canada affirmed our role on these core principles. We will now take this back and work quickly to improve the legislation through Parliament.”
