The federal government recently released proposed regulations that provide federal environmental enforcement officers an administrative alternative to existing enforcement measures. The proposed Environmental Violations Administrative Monetary Penalties Regulations (the “proposed Regulations”) were published in the Canada Gazette on April 9, 2016, and provide key details necessary for the implementation of the administrative monetary penalties (“AMP”) regime authorized by the Environmental Violations Administrative Monetary Penalties Act (“EVAMPA”).
AMPs as an Alternative
AMPs are regulatory in nature, rather than criminal, and are intended to encourage compliance with a regulatory scheme. Both the federal and provincial governments have introduced various AMP schemes on a sector-by-sector basis, but to date, AMPs have not been available to federal environmental enforcement officers as a response to environmental violations.
As it stands, federal environmental officers have a range of enforcement options available to respond to environmental violations. Environmental officers may issue a written warning, a ticket, an Environmental Protection Compliance Order (“EPCO”), or proceed with prosecution. These options are, however, inappropriate in some circumstances. For example, prosecution is time-consuming and expensive and generally reserved for the most serious of offences. Conversely, written warnings may not sufficiently deter violators from reoffending. EPCOs, similar to “stop” or “cease and desist” orders from other legislative regimes, are limited in their application, and like tickets (issued under the Contraventions Act) are only available in response to specific violations under certain environmental statutes. The new AMP regime was developed to fill this gap in enforcement options.
Background and Application
The EVAMPA was enacted under the Environmental Enforcement Act (“EEA”) and came into force in 2010. One of the objectives of the EEA was to strengthen and harmonize the enforcement regimes of nine federal environmental Acts by introducing different categories of offenders and introducing new minimum fines and increased maximum fines. Through the enactment of the EVAMPA, the EEA also established a new enforcement tool, namely AMPs. The AMP regime was implemented in a staged approach set to conclude with the registration of the proposed Regulations.
Beginning in 2011, the proposed AMP regime was subject to an online consultation process. The consultation process solicited suggestions regarding the appropriate violations for the AMP regime, as well as the design, scope and methodology for determining the amounts payable under AMPs.
As drafted, the proposed Regulations will apply to designated violations of six environmental Acts administered by Environment and Climate Change Canada.1 The designated violations include contraventions of specified provisions of the applicable legislation, contraventions of specified directions and orders, and acts of non-compliance with specified conditions of a permit, licence or other authorization.
Proposed Method to Quantify AMPs
Under the proposed Regulations, an AMP may be issued, in the form of a notice of violation, to “a person, ship or vessel” if an enforcement officer believes on reasonable grounds, that the “person, ship or vessel” has committed a contravention of a specified provision under any of the six above-mentioned environmental statutes. As proposed, the amount of baseline penalty applicable to a violation will vary depending on the seriousness of the violation (classified as either Type A, B or C) and the identity of the violator (classified as either an “individual” or “other person, ship or vessel”, which notably includes corporations, government departments, indigenous governments and Bands and Band Councils). For example, under the proposed Regulations:
- Type A violations will represent less serious violations, such as a failure to meet record keeping requirements under an environmental permit.
- Type B violations will cover more serious violations that may or may not cause harm to the environment or constitute an obstruction of authority. For example, when a person is found transporting hazardous waste without being named on a valid transit permit (and thus in violation of the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations).
- Type C violations will represent the most serious violations, such as an act known to cause the degradation or alteration of the environment. For example, where a violator deposits an inherently harmful substance into the environment.
The proposed Regulations also set out aggravating factors that can increase a baseline penalty – namely: the history of non-compliance, environmental harm, and economic gain. For example, a Type C violation issued to an “other person, ship or vessel” could increase from a baseline penalty of $5,000 to a maximum penalty of $25,000 if the violator had a history of non-compliance or achieved an economic gain. Because the baseline AMP amount for a Type C violation already reflects environmental harm, the aggravating factor of “environmental harm” is not applicable.
Defences and the Review Process
AMPs will not be applicable to offences that require proof that an alleged offender possessed a certain mental state, such as those offences that require an act to be committed “knowingly” or “wilfully”. Offences that require a full assessment of the mental state of the alleged offender are excluded from the proposed AMP regime as they are better dealt with by other measures (such as prosecution).
Under the existing EVAMPA, defences are limited. For example, an alleged violator named in a notice of violation does not have a defence by reason that the violator “exercised due diligence to prevent the violation” or “reasonably and honestly believed in the existence of facts, if true, would exonerate” the violator.
An alleged violator served with an AMP may, within 30 days after the day on which the AMP is served (or within any longer period that the Chief Review Officer allows), make a request to the Chief Review Officer for a review of the penalty, the facts of the alleged violation, or both. The Chief Review Officer is an adjudicator, independent from Environment and Climate Change Canada, who conducts reviews requested by an applicant. The review officer or panel must provide its determination in writing within 30 days after the day on which the review is completed. If the review officer or panel determines that the alleged violator has committed a violation, the violator is liable for the amount of the penalty as set out in the decision.
A determination made by the review officer or panel under the EVAMPA is final and binding and is not subject to appeal or to review by any court, except for judicial review under the Federal Courts Act.
AMPs Policy Framework and Comment Period
In addition to the proposed Regulations, the federal government recently released the “Policy Framework of the Administrative Monetary Penalty System at Environment and Climate Change Canada to Implement the Environmental Violations Administrative Monetary Penalties Act”. This Policy Framework Document outlines operational features of the proposed AMP regime, such as: the compliance and enforcement of AMPs (including how AMPs will be issued in conjunction with other enforcement actions), the determination of the amount of penalty under the AMP regime, and the oversight and review process for the AMP regime. The Policy Framework Document also provides responses to questions from the 2011 online consultation process.
The proposed Regulations are now subject to a 60 day comment period (which started on April 9, 2016) and are set to come into force on the day on which they are registered. If registered, the choice of enforcement action, AMPs or otherwise, will rest with enforcement officers according to the principles and factors set out in Environment and Climate Change Canada's existingCompliance and Enforcement Policy. If implemented, it will be interesting to see how environmental officers use AMPs either alone or in conjunction with other enforcement measures, to help achieve higher levels of environmental compliance in Canada.