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Vol. 138, No. 14 — April 3, 2004 Regulations Amending the Ozone-depleting Substances Regulations, 1998Statutory Authority Canadian Environmental Protection Act, 1999 Sponsoring Departments Department of the Environment and Department of Health REGULATORY IMPACT Description The objective of the proposed Regulations Amending the Ozone-depleting Substances Regulations, 1998 (hereinafter referred to as "the proposed Regulations") pursuant to subsections 93(1) and 332(1) of the Canadian Environmental Protection Act, 1999, is to ensure that users that might be unable to switch to non-ozone depleting substance alternatives have access to HCFCs while not undermining Canada's overall consumption reduction commitment. Background The original Montreal Protocol on Substances that Deplete the Ozone Layer signed on September 16, 1987, by Canada along with 23 other countries and subsequently by more than 180 countries, initially established a schedule to reduce the consumption of chlorofluorocarbons (CFCs) and halons. The provisions of the original Montreal Protocol called for a process of continuing review by the parties of the reduction schedule and of the list of controlled ozone-depleting substances (ODS). In subsequent meetings of the Parties, the phase-out schedules were accelerated and the list of controlled ODS was amended to include all substances that contribute to the destruction of the stratospheric ozone layer. The current phase-out schedules cover the production and consumption (production + imports - exports) of CFCs, halons, carbon tetrachloride, methyl chloroform, hydrobromofluorocarbons (HBFCs), methyl bromide, hydrochlorofluorocarbons (HCFCs) and bromochloromethane. These reductions are intended to prevent a global crisis resulting from gradual destruction of the ozone layer, and thus contributing to the protection of the environment, health and human life. As a signatory to the Montreal Protocol, Canada is committed to a phase-out schedule for domestic consumption of HCFCs as well as controls on the production of HCFCs. Relative to the current baseline that has been in place since 1996, Canada must reduce its HCFC consumption according to the following schedule: — Reduce by 35 percent starting January 1, 2004; — Reduce by 65 percent starting January 1, 2010; — Reduce by 90 percent starting January 1, 2015; — Reduce by 99.5 percent starting January 1, 2020; and, — 100 percent elimination by January 1, 2030. In addition to these consumption reductions, Canada is committed to a freeze in HCFC production starting January 1, 2004. Since HCFC production in Canada is much lower than the allowed calculated level of production under the Montreal Protocol, no control is proposed as part of these amendments. The baseline calculated level of consumption of HCFCs in Canada is 887 Ozone Depleting Potential (see footnote 1) (ODP) tonnes. According to the reductions schedule above, the calculated level of HCFC consumption for Canada will be reduced from the current baseline to 577 ODP tonnes on January 1, 2004, to meet the required 35 percent reduction in consumption under the Montreal Protocol. The impacts associated with the reduction schedule of HCFC consumption were previously assessed and included in the Regulatory Impact Analysis Statement for the Ozone-depleting Substances Regulations published in Part II of the Canada Gazette, on December 27, 1995. The proposed Regulations The proposed Regulations are described in more detail in the following section. Under the Ozone-depleting Substances Regulations, 1998 (ODSR 1998), Canada's maximum consumption is split between two use sectors: cooling and other applications. Currently, the cooling sector represents about 19 percent of the total quantity while the other applications sector represents 81 percent. In 2001, the cooling sector was at 98.8 percent of its maximum allowed consumption (166 ODP tonnes of a total of 168 ODP tonnes) while the other applications sector was at 98 percent of its allowed consumption (705 ODP tonnes of 719 ODP tonnes), which suggests that some users might not be ready to switch to non-ODS alternatives on January 1, 2004. The following controls will allow users that are unable to reduce their consumption of HCFC or not ready to move to alternatives to have access to consumption allowances which they would not have access to otherwise. 1. Permanent transfers of consumption allowances Under the current ODSR 1998, companies are allowed to transfer consumption allowances within the same sector. Currently, allowance transfers from an allowance holder to another person lapse at the end of the year during which they are granted. The proposed Regulations would allow companies that are less or no longer involved with ODS to permanently transfer part or all of their allowances to other companies within the same sector. This would decrease the administrative burden on both the transferor and the transferee of submitting redundant requests and annual reports to Environment Canada under ODSR 1998. In addition, since these consumption allowances rest with the company that held them even after it has been merged or acquired by another company, this proposed provision would simplify the transfer procedures for companies that merged with or had been acquired by other companies. 2. Retirement of HCFC consumption allowances As a use sector adopts non-ODS alternatives, it is likely that a consumption allowance holder will no longer need all or part of their allowance. These unused allowances could be useful to other allowance holders that may not be ready to move to non-ODS alternatives or are involved in activities for which alternatives are not yet available. This proposed provision would allow Environment Canada to retain the retired allowances until the next calculation of allowances and redistribute them to other allowance holders that could need them. At the same time, if an allowance holder retires its allowance in total, that allowance holder would no longer need to report annually to Environment Canada. 3. Distribution of consumption allowances a. Cooling sector, whether in refrigeration or air-conditioning Presently, initial consumption allowances are calculated the same years as the years of reduction under the phase-out schedule of the Montreal Protocol. It is proposed to do an additional calculation of initial allowances on January 1, 2007. In that year, the initial consumption allowance would be based on the average of the calculated level of consumption of HCFCs for 2004 and 2005. This new period of calculation will give Environment Canada the opportunity to redistribute in 2007 consumption allowances that have been retired. b. Other applications It is proposed that consumption allowances in this sector be calculated every year, using a "use-it-or-lose-it" system for a transitional period of two years. In 2004, the consumption allowances would be calculated as currently indicated in the Regulations. Starting January 1, 2005, until December 31, 2006, a company's consumption allowance would be equivalent to the company's calculated level of consumption of HCFCs in the previous year. However, if a company holding an allowance in this sector uses less than 90 percent of its allowance, customers of this company could apply to the Minister of the Environment for their pro-rated share of the holder's unused allowance based on the quantities supplied to each of them in 2002. Starting January 1, 2007, until December 1, 2009, the consumption allowances would be equal to the average of the calculated levels of consumption for 2005 and 2006. Starting in 2010, the calculations will be as currently indicated under ODSR 1998. c. Both use sectors (cooling and other applications) A "buffer zone" representing 10 percent of a person's consumption allowances that will apply to both sectors would be established. Given that buffer zone, if an allowance holder uses 90 percent or more of its allowance, the allowance will be considered as 100 percent used for the purpose of calculation and there would be no loss for the allowance holder when the allowances are calculated for the next period. If an allowance holder uses less than 90 percent of their allowances, the allowance quantity would therefore be automatically reduced by the amount of the unused quantity in the next calculation if that year is a base year for calculation of initial allowances. This unused quantity would be redistributed by Environment Canada to other allowance holders. 4. Prohibition of the export of CFCs and Halons The proposed Regulations will also include one of the control measures that appeared in Canada's Strategy to Accelerate the Phase-out of CFC and Halon Uses and to Dispose of the Surplus Stocks which was approved in May 2001 by the Canadian Council of Ministers of the Environment (CCME). This measure was also included in the updated National Action Plan for the Environmental Control of Ozone-depleting Substances (ODS) and their Halocarbon Alternatives (May 2001) under subsection 3.3.1. The first National Action Plan (NAP) was approved in October 1992 and issued as a CCME document entitled "National Action Plan for Recovery, Recycling, and Reclamation of Chlorofluorocarbons (CFCs)." The NAP focused mainly on recovery, recycling, and reclamation of CFCs from refrigeration and air conditioning systems. It was revised in 1998 and 2001. A prohibition to export Halons and CFCs, with the exception of export for destruction or essential purposes, would be established. The export for reclamation and import back to Canada, as well as re-exportation of CFCs or Halons imported for reclamation will still be allowed. These proposed Regulations will come into effect on the date of their registration. Alternatives Status quo The status quo was considered; however, some stakeholders requested that the allowance system be revised to ensure proper supplies of HCFCs during the transition from HCFCs to alternatives, especially in the other applications sector, where the transition appears to be more challenging. The proposed Regulations will provide stakeholders with more flexibility to adapt to the 35-percent reduction in HCFC consumption required under the Montreal Protocol. Stakeholders would have more options to manage their allowance and customers of allowance holders would have to have access to some HCFCs until their conversion to non-ODS alternatives is complete. Without these proposed amendments, some stakeholders might face difficulty in accessing supplies of HCFCs during the transition to non-ODS alternatives. Removal of barrier between the cooling sector and the other applications sector The Discussion Document containing Environment Canada's proposal to amend the Regulations discussed during the stakeholder's consultations proposed that the barrier that prevents the exchange of allowances between the two authorized sectors under the Regulations be removed to help the supplies in HCFCs in applications with a higher demand. Several comments were received on this proposal. Although some stakeholders expressed their preference for a unified system, many commented that the removal of the barrier would work as a disincentive for users to move away from HCFCs. Environment Canada decided to keep the status quo, i.e. the barrier between the two sectors, as it was not clear that there are real advantages to any change. Possible controls on imports of recovered, recycled, reclaimed or used HCFCs The purpose of this proposal was to cap the quantities of recovered, recycled, reclaimed or used (RRRU) HCFCs imported into Canada to an average of the quantities imported in 2000 and 2001. Quantities would have been distributed through a permit system until the cap would be reached. Each permit would have been up to a maximum of two ODP tonnes. Any person could have made a request for a permit to import RRRU HCFCs. More work is needed to ensure that controls to be put in place meet Canada's objectives in this area and are consistent with our international trade obligations. This measure cannot be proposed at this point. Environment Canada will continue monitoring the import and export of RRRU HCFCs through the current permit system, and intends to continue to explore which measures may be required in the future to ensure an overall reduction of HCFCs in Canada. Production control on HCFCs The Montreal Protocol requires that, starting January 1, 2004, developed countries do not exceed their allowed calculated level of production of HCFCs. For Canada, this translates to a maximum calculated level of production of 817 ODP tonnes. Environment Canada proposed to implement a system of production allowances to ensure that Canada meets its commitment under the Montreal Protocol. Canada's maximum allowed calculated level of production under the Montreal Protocol is sufficiently high compared to the production capacity of HCFCs in Canada. It is likely that HCFC production in Canada will not exceed the maximum quantity allowed under the Protocol. Therefore, Environment Canada considers an amendment to the Regulations with production reduction controls unnecessary. Benefits and costs Benefits 1. Permanent transfers of consumption allowances Companies that want to transfer their allowances to other companies have to submit a request for transfer to Environment Canada every year. This proposed amendment will reduce the administrative burden for both Environment Canada and allowance holders by allowing transfers to be made only once. This translates into cost savings to both parties. However, the size of this positive impact is estimated to be small. 2. Retirement of allowances Allowances no longer needed by an allowance holder can be retired and redistributed by Environment Canada in the next calculation period to other allowance holders that need them. There are no significant impacts associated with this proposed amendment. There can be a monetary gain to allowance holders, as the allowances will become more valuable with a decrease in consumption allocations. To that extent, it is expected that few HCFC allowances will be retired under the proposed Regulations. 3. Distribution of consumption allowances A proposed standard for foams being used in the building industry is under development and will not be completed by January 1, 2004. These alternative foam formulations have to undergo a broad spectrum of tests to ensure that problems are not encountered when switching away from HCFCs. The proposed "use-it-or-lose-it" rule will be in place for a transitional period of two years (2005 and 2006) and will provide time for the development of appropriate standards for new foam formulations without HCFC. As Environment Canada will distribute unused allowances to customers of suppliers that do not use all of their allowances, this will allow the customers to import HCFCs from abroad until their conversion to non-ODS alternatives is completed. An additional benefit of this amendment is that since calculations of allowances are done every year for a two-year transitional period and allocations are redistributed only at the next period of calculations, there would be some environmental and health benefits from reduced emissions during the period when the unused allowances are not yet redistributed. 4. Prohibition of the export of CFCs and halons As part of the ongoing process of fulfilling Canada's commitment to protect the ozone layer, the proposed Regulations will prohibit the export of CFCs and Halons, except for destruction or essential purposes. This will ensure that any surplus stock of CFCs and Halons still available in Canada will be efficiently managed and eliminated. This will also ensure that these substances are not made available to countries were they are still in use and may contribute to further emissions of ODSs. This proposed amendment will have a positive impact both for Canadians, in terms of environmental and health benefits, and globally, through the further reduction of ODS emissions into the atmosphere. These expected benefits resulting from the implementation of this proposed amendment were difficult to quantify. Costs Compliance costs In addition to those already incurred under the ODSR 1998, it is expected that there will be negligible incremental costs to the industry associated with the proposed amendments. These incremental costs are of an administrative nature. They are linked with the amendment to the system of calculation of allowances and the submission of requests for permanent transfers or notice to retire allowances. These costs will be offset by the reduced administrative costs related to not submitting annual reports to Environment Canada in the case of permanent transfer or retirement of allowances. Costs to government It is estimated that there will be small administrative costs to government related to the proposed amendments in addition to those already incurred to calculate and distribute allowances and to process reports submitted to Environment Canada by affected companies. Those additional but small costs to government are linked to the addition of a calculation year in 2007 to redistribute allocations to companies in the cooling sector, to calculate allowances each year for two years for the other applications sector, to calculate allowances to be distributed to customers of allowance holders that used less than 90 percent of their allowances in the case of the other applications sector, and to process requests for permanent transfer or notice to retire allowances. Compliance promotion and enforcement costs are not expected to be different from those already incurred under ODSR 1998, since is it estimated that no additional enforcement effort will be required with respect to the proposed amendments. Overall, it is estimated that net benefits associated with these amendments are positive, but are considered to be small. Consultation In December 2002, a Discussion Document containing Environment Canada's proposal to amend the Regulations was distributed to more than 2 500 stakeholders for their comments. Consultations with all concerned parties, particularly those directly affected by these amendments, were held during meetings of the Multistakeholder Working Group on Ozone-depleting Substances and their Alternatives in November 2002 and April 2003. The comments raised can be summarized as follows: Distribution of consumption allowances Cooling, whether in refrigeration or air-conditioning In general, comments received from the Cooling sector indicated that allowance holders believe that the current allowance system is suitable to them. After reviewing and analyzing all the comments from stakeholders from this sector, Environment Canada proposes to make no change to the calculation of the initial or baseline consumption for the cooling sector, except for an additional year of calculation in 2007. Other applications Some stakeholders commented that Environment Canada should keep the status quo and were concerned that Environment Canada was changing the rules by changing the manner in which allowances were calculated. One stakeholder claimed that the proposed amendments could have an impact on its business because low customer demand in one year could limit supply in subsequent years, and that current allowance holders could not develop proper business plans if significant changes to the allowance system were made. Environment Canada believes that there should be a mechanism to make sure that some users have access to HCFC until their transition to alternatives is completed. The proposed use-it-or-lose-it system for a transitional period of two years will allow some stakeholders to have access to certain quantities of HCFCs, and this transitional period is necessary for the overall reductions of HCFC uses in Canada. Other stakeholders, especially foam formulators, believed that the proposed amendments may help them have access to quantities of HCFCs until their transition to non-ODS alternatives is completed. Prohibition of the export of CFCs and halons One stakeholder would have preferred that this prohibition be limited to the export to developing countries. Environment Canada believes that limiting the prohibition to developing countries could be judged as discriminatory. The other comments received supported this proposed amendment. Compliance and enforcement Since the proposed Regulations would be promulgated under the Canadian Environmental Protection Act, 1999, enforcement officers will, when verifying compliance with the Regulations, apply the Compliance and Enforcement Policy implemented under the Act. The policy outlines measures designed to promote compliance, including education, information, promoting of technology development and consultation on the development of the Regulations. The policy also sets out the range of possible responses to violations: warnings, directions, environmental protection compliance orders, ticketing, ministerial orders, injunctions, prosecution, and environmental protection alternative measures (which are an alternative to a court trial after the laying of charges for a CEPA 1999 violation). In addition, the policy explains when Environment Canada will resort to civil suits by the Crown for costs recovery. When, following an inspection or an investigation, an enforcement officer discovers an alleged violation, the officer will choose the appropriate enforcement action based on the following criteria: — Nature of the alleged violation: This includes consideration of the seriousness of the harm or potential harm to the environment, the intent of the alleged violator, whether it is a repeat violation, and whether an attempt has been made to conceal information or otherwise subvert the objectives and requirements of the Act. — Effectiveness in achieving the desired result with the alleged violator: The desired result is compliance with the Act within the shortest possible time and with no further repetition of the violation. Factors to be considered include the violator's history of compliance with the Act, willingness to cooperate with enforcement officers, and evidence of corrective action already taken. — Consistency in enforcement: enforcement officers will consider how similar situations have been handled in determining the measures to be taken to enforce the Act. Contacts Ms. Jacinthe Girard, Acting Head, Ozone Protection Programs Section, National Office of Pollution Prevention, Environment Canada, Gatineau, Quebec K1A 0H3, (819) 953-4168, or Ms. Céline Labossière, Policy Manager, Regulatory and Economic Analysis Branch, Environment Canada, Gatineau, Quebec K1A 0H3, (819) 997-2377. PROPOSED REGULATORY TEXT Notice is hereby given, pursuant to subsection 332(1) of the Canadian Environmental Protection Act, 1999 (see footnote a), that the Governor in Council, pursuant to subsection 93(1) of that Act, proposes to make the annexed Regulations Amending the Ozone-depleting Substances Regulations, 1998. Any person may, within 60 days after the date of publication of this notice, file with the Minister of the Environment comments with respect to the proposed Regulations or a notice of objection requesting that a board of review be established under section 333 of the Canadian Environmental Protection Act, 1999 (see footnote b) and stating the reasons for the objection. All comments and notices must cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to the Chief, Chemicals Control Division, Department of the Environment, Ottawa, Ontario K1A 0H3. Any person who provides information to the Minister of the Environment may submit with the information a request for confidentiality under section 313 of the Canadian Environmental Protection Act, 1999 (see footnote c). Ottawa, March 30, 2004
EILEEN BOYD
REGULATIONS AMENDING THE OZONE-DEPLETING SUBSTANCES REGULATIONS, 1998 AMENDMENTS 1. The description of "ODP" in paragraph (a) of the definition "calculated level" in section 1 of the English version of the Ozone-depleting Substances Regulations, 1998 (see footnote 2) is replaced by the following: ODP is the ozone-depleting potential, set out in column 3 of an item of Schedule 2, for the controlled substance set out in column 2 of that item, and 2. Section 2.2 of the Regulations is renumbered as subsection 2.2(1) and is amended by adding the following: (2) The Minister shall acknowledge receipt of the notice in writing. 3. Section 4 of the Regulations is replaced by the following: 4. No person shall import or export a controlled substance from or to a State that is not a Party. 4. Subsections 5(2) to (4) of the Regulations are replaced by the following: (2) A person who imports for reclamation a recovered, recycled, reclaimed or used controlled substance, other than methyl bromide, an HCFC, a bromofluorocarbon or bromochlorodifluoromethane, shall, within six months after its importation, export it back to the country of origin. (3) No person shall import a recovered, recycled, reclaimed or used bromofluorocarbon or bromochlorodifluoromethane except where (a) the bromofluorocarbon or bromochlorodifluoromethane will be used for an essential purpose in another country; and (b) the bromofluorocarbon or bromochlorodifluoromethane will be exported to its country of destination within six months after its importation. (4) Where a person who has imported a recovered, recycled, reclaimed or used controlled substance has failed to comply with subsections (2) or (3), as applicable, the person shall have it destroyed at a destruction facility that is operated in accordance with the Regulatory Standards for Destruction Facilities set out in the Handbook for the International Treaties for the Protection of the Ozone Layer, as amended from time to time, published by the Ozone Secretariat, United Nations Environment Programme, or export it for destruction no later than three months after the end of the six-month period referred to in the applicable subsection. 5. (1) Paragraph 7(2)(e) of the Regulations is replaced by the following: (e) the person exports, under a permit issued under paragraph 33(1)(b), a controlled substance that the person imported by mistake or without consenting to its import; (2) Subsection 7(2) of the Regulations is amended by adding the word "or" at the end of paragraph (f) and by adding the following after paragraph (f): (g) the person exports a CFC, a bromofluorocarbon or bromochlorodifluoromethane under a permit issued under paragraph 33(1)(b). 6. (1) Paragraph 8(3)(a) of the Regulations is replaced by the following: (a) the person has been informed in writing by the Minister of their initial consumption allowance of HCFCs and of the authorized sector for the allowance for that year; (2) Paragraph 8(3)(c) of the Regulations is replaced by the following: (c) the person has been informed in writing by the Minister of their baseline consumption allowance of HCFCs and of the authorized sector for the allowance for that year; or 7. (1) Paragraph 10(1)(b) of the Regulations is replaced by the following: (b) the calculated level of the quantity of HCFCs that is equivalent to the person's consumption of CFCs for that sector for 1994 for which it was determined by the Minister, based on the information received in response to a notice published or sent under section 16 or 18 of the Canadian Environmental Protection Act, chapter 16 of the 4th Supplement to the Revised Statutes of Canada, 1985, or, when appropriate, section 71 of the Act, that those CFCs will be replaced by HCFCs. (2) Subsection 10(2) of the Regulations is replaced by the following: (2) A person's initial consumption allowance of HCFCs for a year referred to in subsection (1) is zero if (a) the person has not provided, at any time before December 1 in a previous year, information about the manufacture, importation and use of HCFCs and CFCs for 1994 as required by a notice published or sent under section 16 or 18 of the Canadian Environmental Protection Act, chapter 16 of the 4th Supplement to the Revised Statutes of Canada, 1985, or, when appropriate, section 71 of the Act; or (b) the person has provided to the Minister, before December 1 in any previous year, a notice in writing in the form approved by the Minister in which the person states their intention to retire their allowance. (3) The portion of subsection 10(3) of the Regulations before paragraph (a) is replaced by the following: (3) A person's initial consumption allowance of HCFCs for the authorized sector of cooling, whether in refrigeration or air-conditioning, (4) Paragraph 10(3)(b) of the Regulations is replaced by the following: (b) for each year that falls within the period that begins on January 1, 2004 and ends on December 31, 2006, is the average of their calculated level of consumption of HCFCs for that sector for 2001 and 2002 multiplied by 65%; (b.1) for each year that falls within the period that begins on January 1, 2007 and ends on December 31, 2009, is the average of their calculated level consumption of HCFCs for that sector for 2004 and 2005; (5) Subsection 10(3.1) of the Regulations is replaced by the following: (3.01) A person's initial consumption allowance of HCFCs for the authorized sector of any other application (a) for the year that begins on January 1, 2004 and ends on December 31, 2004, is the average of their calculated level of consumption of HCFCs for that sector for 2001 and 2002 multiplied by 65%; (b) for each year that falls within the period that begins on January 1, 2005 and ends on December 31, 2006, is their calculated level of consumption of HCFCs for that sector for the year preceding the year of calculation; (c) for each year that falls within the period that begins on January 1, 2007 and ends on December 31, 2009, is the average of their calculated level of consumption of HCFCs for that sector for 2005 and 2006; (d) for each year that falls within the period that begins January 1, 2010 and ends on December 31, 2014, is the average of their calculated level of consumption of HCFCs for that sector for 2007 and 2008 multiplied by 35%; and (e) for each year that falls within the period that begins on January 1, 2015 and ends on December 31, 2019, is the average of their calculated level of consumption of HCFCs for that sector for 2012 and 2013 multiplied by 10%. (3.1) For the purpose of calculating a person's initial consumption allowance of HCFCs for a year set out in subsections (3) and (3.01), a person's calculated level of consumption for a year cannot be less than zero. (3.11) For the purpose of calculating a person's initial consumption allowance of HCFCs for a year, when the person's calculated level of consumption for the year is equal to 90% or more of the person's initial consumption allowance for that year, the calculated level of consumption for that year is considered to be 100% of the person's initial consumption allowance of HCFCs. (3.12) When a person's initial consumption allowance for the authorized sector of any other application for a year that falls within the period that begins on January 1, 2005 and ends on December 31, 2006 is less than 90% of the person's initial consumption allowance for that year, the Minister shall provide to each recipient of HCFCs who requests it, the portion of their unexpended consumption allowance for that year corresponding to the product obtained by multiplying the unexpended consumption allowance by the ratio that (a) the quantity of HCFCs sold or otherwise supplied to that recipient, is to (b) the total quantity of HCFCs sold or otherwise supplied to all of the recipients of HCFCs. (3.13) A recipient may apply to the Minister, in the form approved by the Minister, for a portion of an unexpended consumption allowance of a person referred to in subsection (3.12) before December 1 of the year preceding the one for which the recipient requires the portion of the person's unexpended consumption allowance. (3.14) For the purpose of this section, "recipent" means a person in Canada to whom a person who has an HCFC consumption allowance sold or otherwise supplied an HCFC, based on the information submitted in the annual report for 2002 as required under subsection 16(1). (6) The portion of paragraph 10(4)(c) of the Regulations before subparagraph (i) is replaced by the following: (c) the result obtained by multiplying the sum of the remainder of Canada's maximum consumption of HCFCs for the year and the retired allowances of HCFCs for the preceding year by the ratio of (7) Paragraph 10(7)(a) of the Regulations is replaced by the following: (a) the person has not provided, before December 1 in the previous year, information about the importation, distribution, application and use of methyl bromide for 1991, 1992 and 1993 as required by a notice published or sent under section 16 or 18 of the Canadian Environmental Protection Act, chapter 16 of the 4th Supplement to the Revised Statutes of Canada, 1985, or, when appropriate, section 71 of the Act; or (8) Paragraph 10(7)(b) of the English version of the Regulations is replaced by the following: (b) the person has provided to the Minister, before December 1 in any previous year, notice in writing in the form approved by the Minister in which the person states their intention to retire their allowance. (9) Section 10 of the Regulations is amended by adding the following after subsection (7): (8) For the purpose of calculating a person's consumption allowance for a year, a person's calculated level of consumption for a controlled substance shall not include their calculated level of consumption of recovered, recycled, reclaimed or used controlled substance. 8. The Regulations are amended by adding the following after section 11: 11.1 Any allowance adjustment allowed under these Regulations shall expire at the end of the year for which it is granted. 9. Section 12 of the Regulations is amended by adding the following after subsection (3): (3.1) A transfer allowed under these Regulations shall expire at the end of the year for which it is granted, unless the transferor and the transferee indicate, in the proposed transfer referred to in subsection (2), that the transfer expires on the day preceding the next year of calculation of initial consumption allowance referred to in subsection 10(3) or (3.01). 10. Subsection 15(3) of the Regulations is repealed. 11. (1) Paragraph 17(1)(b) of the Regulations is replaced by the following: (b) keep the records at their principal place of business in Canada for a period of five years after the records are made. (2) Paragraph 17(2)(b) of the Regulations is replaced by the following: (b) keep the records at their principal place of business in Canada for a period of five years after the records are made. (3) Subsection 17(3) of the Regulations is replaced by the following: (3) Every person who imports or exports a controlled substance during any year shall provide to the customs office where the substance is required to be reported under section 12 of the Customs Act a copy of their permit, the Minister's written confirmation of their consumption allowance or the acknowledgement of the notice of shipment in transit. 12. The heading before section 18 of the Regulations is replaced by the following: Restrictions on CFCs, Bromofluorocarbons, Bromochlorodifluoromethane,
Tetrachloromethane 13. Subsections 18(1) and (1.1) of the Regulations are replaced by the following: 18. (1) No person shall manufacture or import a product that contains or is designed to contain any CFC, bromofluorocarbon, bromochlorodifluoromethane, tetrachloromethane or 1,1,1- trichloroethane. (1.1) No person shall use, sell or offer for sale for any other purpose any CFC, bromofluorocarbon, bromochlorodifluoromethane, tetrachloromethane or 1,1,1-trichloroethane that is recovered from a product in which the substance was used for a purpose set out in column 3 of Schedule 3. 14. Paragraph 20(1)(b) of the Regulations is replaced by the following: (b) fire extinguishing equipment that contains or is designed to contain any bromofluorocarbon or bromochlorodifluoromethane and that is to be used in aircraft or military ships or vehicles if the equipment is imported from a Party; or 15. Subsection 21(1) of the Regulations is replaced by the following: 21. (1) No person shall export to a Party operating under paragraph 1 of Article 5 of the Protocol a product that contains or is designed to contain any CFC, bromofluorocarbon, bromochlorodifluoromethane, tetrachloromethane or 1,1,1-trichloroethane without a permit issued under paragraph 33(1)(e). 16. Section 22 of the Regulations is replaced by the following: 22. No person shall manufacture, use, sell, offer for sale or import any HCFC or any product that contains or is designed to contain any HCFC if the HCFC or the product is for use in areas of application in which a controlled substance has never been used in Canada. 17. (1) Subsection 23(4) of the English version of the Regulations is replaced by the following: (4) Subsections (1) and (2) do not apply in respect of a product that is intended to be used as an animal or human health care product, including any bronchial dilator, inhalable steroid, topical anaesthetic and veterinary powder wound spray. (2) Subsection 23(5) of the Regulations is replaced by the following: (5) Subsections (1) and (2) do not apply in respect of an HCFC or a product that is used in a laboratory or for analysis or the calibration of a leak detection system. 18. Section 28 of the Regulations is replaced by the following: 28. On or after January 1, 2010, no person shall manufacture or import any product that contains or is designed to contain HCFC-141b, HCFC-142b or HCFC-22. 19. Section 30 of the Regulations is replaced by the following: 30. On or after January 1, 2020, no person shall manufacture or import any product that contains or is designed to contain any HCFC. 20. Section 31 of the Regulations is replaced by the following: 31. Despite any provision of this Part, a person may manufacture, use, sell, offer for sale, import or export a controlled substance or a product that contains or is designed to contain a controlled substance, if the person has been issued a permit to do so under paragraph 33(1)(f). 21. (1) Paragraph 32(a) of the Regulations is replaced by the following: (a) a permit to import a controlled substance that is for destruction; (a.1) a permit to import a controlled substance that is a recovered, recycled, reclaimed or used controlled substance referred to in subsection 5(1); (2) Paragraph 32(f) of the Regulations is replaced by the following: (f) a permit for manufacturing, using, selling, offering for sale, importing or exporting any controlled substance or product that contains or is designed to contain a controlled substance, and that is referred to in section 31. 22. (1) Subparagraph 33(1)(a)(v) of the Regulations is replaced by the following:
(2) Paragraph 33(1)(b) of the Regulations is replaced by the following: (b) issue the permit referred to in paragraph 32(b) to the applicant if they submit documentation confirming the nature of the controlled substance in the following cases, namely,
(3) Subsection 33(3) of the Regulations is replaced by the following: (3) The Minister may refuse to issue a permit if the Minister has reasonable grounds to believe that the applicant is not able to manufacture, use, sell, offer for sale, import or export a controlled substance or a product containing or designed to contain a controlled substance, as the case may be, in compliance with Canadian law applicable to the substance, product or activity. 23. Sections 35 and 36 of the Regulations are replaced by the following: 35. The Minister may refuse to increase a consumption allowance under section 11 or to allow a transfer under section 12 if the Minister has reasonable grounds to believe that the applicant is not able to manufacture, use, sell, offer for sale, import or export the controlled substance or the product that contains or is designed to contain a controlled substance, as the case may be, in compliance with Canadian law applicable to the substance, product or activity. 24. The portion of section 1 of Schedule 5 to the English version of the Regulations before paragraph (a) is replaced by the following: 1. Notice to retire consumption allowance: information respecting the applicant, namely, 25. Section 3 of Schedule 5 to the Regulations is amended by striking out the word "and" at the end of paragraph (a), by adding the word "and" at the end of paragraph (b) and by adding the following after paragraph (b): (c) whether the transfer is being requested for the year mentioned in the application or until the day preceding the beginning of the next year of calculation of initial consumption allowance referred to in subsection 10(3) or (3.01). 26. Subsection 4(d)(i) of Schedule 5 to the Regulations is replaced with the following:
27. Subparagraphs 6(d)(i) and (ii) of Schedule 5 to the Regulations are replaced by the following:
(ii) quantity supplied to each recipient in Canada, and (iii) a declaration under subparagraph 7(2)(b)(ii) of the Regulations. 28. (1) The portion of paragraph 7(b) of Schedule 5 to the Regulations before subparagraph (i) is replaced by the following: (b) information respecting each recipient in Canada, namely, (2) The portion of paragraph 7(d) of Schedule 5 to the Regulations before subparagraph (i) and subparagraph (i) are replaced by the following: (d) information respecting each recipient in Canada and the controlled substance, namely,
(3) Subparagraph 7(d)(ii) of Schedule 5 to the English version of the Regulations is replaced by the following:
(4) Subparagraph 7(d)(iii) of Schedule 5 to the Regulations is replaced by the following
29. (1) The portion of section 9 of Schedule 5 to the Regulations before paragraph (a) is replaced by the following: 9. Application for a permit to export a product that contains or is designed to contain CFCs, bromofluorocarbons, bromochlorodifluoromethane, tetrachloromethane or 1,1,1-trichloroethane: (2) Subparagraph 9(c)(i) of Schedule 5 to the Regulations is replaced by the following:
(3) Paragraph 9(d) of Schedule 5 to the Regulations is replaced by the following: (d) declaration of understanding by the applicant that the information may be released to the Party of import. 30. (1) The portion of paragraph 11(b) of Schedule 5 to the Regulations before subparagraph (i) is replaced by the following: (b) information respecting the controlled substance, or the product referred to in subsection 21(1) of these Regulations that contains or is designed to contain a substance identified in that subsection, namely, (2) Subparagraph 11(b)(iii) of Schedule 5 to the French version of the Regulations is replaced by the following:
(3) Paragraph 11(e) of Schedule 5 to the Regulations is amended by striking out the word "and" at the end of subparagraph (i) and by adding the following after subparagraph (ii):
31. (1) The portion of section 12 of Schedule 5 to the Regulations before paragraph (a) is replaced by the following: 12. Quarterly report (recovered, recycled, reclaimed or used controlled substances): (2) The portion of paragraph 12(b.1) of Schedule 5 to the Regulations before subparagraph (i) is replaced by the following: (b.1) information respecting each recipient of each shipment, namely, (3) Subparagraph 12(b.1)(ii) of Schedule 5 to the English version of the Regulations is replaced by the following:
(4) Paragraph 12(d) of Schedule 5 to the Regulations is amended by striking out the word "and" at the end of subparagraph (i), by adding the word "and" at the end of subparagraph (ii) and by adding the following after subparagraph (ii):
32. Paragraph 2(c) of Schedule 6 to the Regulations is replaced by the following: (c) the actual quantity of each controlled substance sold or otherwise supplied, that quantity expressed as a calculated level, the names and addresses of the customers and the declarations referred to in clause 7(2)(b)(ii)(B) and paragraph 33(1)(c) of the Regulations. 33. Subsection 3(2) of Schedule 6 to the Regulations is replaced by the following: (2) Copies of the bill of lading, the invoice and all documents submitted to the Canada Customs and Revenue Agency for each shipment of a controlled substance. 34. Subsection 4(2) of Schedule 6 to the Regulations is replaced by the following: (2) Copies of the bill of lading, the invoice and all documents submitted to the Canada Customs and Revenue Agency for each shipment of a controlled substance. COMING INTO FORCE 35. These Regulations come into force on the day on which they are registered. [14-1-o] The ODP is the ratio of the impact on ozone of a chemical compared to the impact of a similar mass of CFC-11, for which the ODP is defined to be 1.0. S.C. 1999, c. 33 S.C. 1999, c. 33 S.C. 1999, c. 33 SOR/99-7 |
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