On June 23, 2014, the Ministry of Environment introduced an administrative penalty program to encourage compliance with the Environmental Management Act (the “EMA”) and the Integrated Pest Management Act (the “IPMA”). The Administrative Penalties Regulation (the “Regulation”) was designed to bridge the gap between warnings and violation tickets for minor offences and criminal prosecutions for more serious offences.
Examples of violations that can attract an administrative penalty include unauthorized waste discharges, discharges in excess of the amount permitted under an authorization or regulation, and a failure to submit monitoring reports.
Before making a determination with respect to an administrative penalty, the Director must provide notice to the person alleged to have breached the EMA or the IPMA and provide that person with an opportunity to make representations. While the Director retains the discretion to schedule an oral hearing, in the vast majority of cases it is expected that only written submissions will be accepted. Following a hearing, the Director will make a determination and inform the person of any penalty. A party against whom an administrative penalty has been imposed may appeal that decision to the Environmental Appeal Board.
Liability under the Regulation is absolute; due diligence is not a defence. However, the Regulation provides that the Director must consider various factors in determining the amount of any penalty, including the nature of the contravention, the real or potential adverse effect of the contravention, previous contraventions by the person, and the person’s efforts to correct the contravention. If the contravention continues for more than one day, the Director has discretion to impose a separate administrative penalty for each day the contravention continues.
Maximum fines under the Regulation range from $2,000 to $75,000, depending on the nature of the contravention. These amounts are (relatively) low, particularly compared with the Administrative Penalties Regulation under the Oil and Gas Activities Act, which provides for fines of up to $500,000. However, companies should keep in mind that a determination of a contravention under the Regulation will form part of their record of violations and could expose them to significantly greater liability for future offences under the EMA and IPMA, as well as certain federal legislation, including the Canadian Environmental Protection Act (the “CEPA”), which provides for steep fines (up to $1,000,000) for repeat offenders. For the purposes of CEPA, a company may be found to be a repeat offender if convicted of a “substantially similar offence” under a provincial statute relating to environmental or wildlife conservation or protection, such as the EMA or the IPMA.