The federal government is expediting passage of legislation to amend and replace the Nuclear Liability Act. This initiative is proceeding without the media attention or public debate that one might expect for the introduction of important new legislation, particularly on the sensitive nuclear file.

On October 30, 2007, Bill C-5 (the Nuclear Liability and Compensation Act) passed second reading in the House of Commons and was referred to the Standing Committee on Natural Resources for detailed review. Industry stakeholders made submissions to the Committee for amendments to the Bill and members of the Committee from the opposition parties similarly tabled motions for amendment; however, on December 12, 2007, just prior to adjournment of the House for the holiday break, the Committee reported Bill C-5 to the House of Commons without amendment.

Parliament is scheduled to return on January 28, 2008. Observers expect that the Bill will proceed quickly to third reading for adoption. This will be the final opportunity for debate and amendment by the opposition parties.

Once adopted by the House, Bill C-5 will go to the Senate. If the Senate chooses to refer the Bill to committee for further review, interested stakeholders may be presented with another occasion to make submissions for amendments.

Bill C-5 re-states the key principles of the liability regime established under the Nuclear Liability Act for damage caused by the occurrence of a nuclear incident in Canada, namely, that:

  • The operator's liability is exclusive; that is, no person other than an operator is liable for damage caused within Canada; and
  • The operator's liability is an absolute, strict liability requiring no proof of fault or negligence.

Similar to the Nuclear Liability Act, Bill C-5 provides for the establishment of an administrative tribunal to hear and decide claims where the Governor in Council believes it to be in the public interest to do so, having regard to the extent and the estimated cost of the damage. Upon establishment of the tribunal, the government will be responsible for payment of all compensation awards determined by the tribunal.

There are a number of important changes introduced by the Bill, the most significant being a massive increase in the maximum liability for operators from $75 million to $650 million. This increased liability will be reviewed at least once every five years by the Minister of Natural Resources and, if appropriate, the Minister would have the statutory mandate to increase (but not decrease) the maximum liability threshold by regulation without debate in the House of Commons or consultation with industry stakeholders.

Bill C-5 is identical to Bill C-23, the proposed amending legislation tabled in the last Parliamentary Session but which died on the Order Paper with the prorogation of Parliament in advance of the throne speech last October. Industry observers hope that this important legislation will not meet a similar demise due to closing of the current Parliamentary Session before passage of the Bill by the House and Senate, particularly for a spring election.