8 MARINE TRANSPORTATION

MAJOR EVENTS IN 2005

LEGISLATIVE AND REGULATORY CHANGES AND INITIATIVES

CANADA SHIPPING ACT AND REGULATORY REFORM UNDER THE CANADA SHIPPING ACT, 2001

The Canada Shipping Act, 2001 (CSA 2001) received Royal Assent on November 1, 2001. Until the necessary regulations are in place, however, the existing Canada Shipping Act and its related regulations will remain in full force and effect.

The new regulations are being dealt with in two phases. Phase 1, expected to be completed early in 2007, will see more than 50 existing regulations reformed and streamlined into an estimated 22 regulations. At that time, the CSA 2001 will come into force. Phase 2 will see the remaining regulations modernized so they are consistent with the requirements of the new Act.

The CSA is the main legislation overseeing personal safety and environmental protection in Canada's marine sector. It applies to Canadian vessels operating anywhere and to foreign vessels operating in Canadian waters. In 2003, CSA legislative and regulatory responsibilities relating to pleasure craft safety, marine navigation services, pollution prevention and response, and navigable waters were transferred from Fisheries and Oceans Canada to Transport Canada.

With these added responsibilities, Transport Canada conducted cross-country public consultations on the Phase 1 regulations throughout 2004 and 2005. The bulk of these consultations occurred at the spring and fall regional and national meetings of the Canadian Marine Advisory Council (CMAC). In addition, several of the individual projects conducted outreach sessions with stakeholders at strategic locations across Canada. The Regulatory Reform Project had for the most part completed its formal consultation phase by the end of 2004, and most projects are now in the legal drafting phase. A few individual projects continued consultations during 2005.

Some of the 22 streamlined regulations to come out of Phase 1 include Administrative Monetary Penalties, Ballast Water and Control Management, Cargo, Fumigation and Tackle, Collision, Competency of Operators of Pleasure Craft, Environmental Response, Fire Safety, Fishing Vessel Safety, Heritage Wreck, Load Lines, Marine Personnel, Prevention of Pollution from Ships and for Dangerous Chemicals, Small Vessels, Vessel Clearance, Vessel Operation Restrictions, and Vessel Registration and Tonnage. Added to the original list of Phase 1 regulations are Vessel Certificates, Safety Management, Ships Registry and Licensing Fees Tariff, and Appeal from Detention Orders, along with three minor regulations that need to be repealed. For more information on the CSA 2001 Regulatory Reform Project, visit www.tc.gc.ca/marinesafety/menu.htm.

MARINE LIABILITY ACT

MARITIME LAW REFORM DISCUSSION PAPER

In May 2005, Transport Canada released the Maritime Law Reform Discussion Paper. This paper proposes a number of amendments to the Marine Liability Act as well as the modernization of outdated concepts in maritime law.

The proposed amendments include the possible ratification of four international conventions: the 1976 Convention on the Limitation of Liability for Maritime Claims, as amended by its 1996 Protocol; the Supplementary Fund Protocol of 2003 of the International Oil Pollution Compensation Fund Convention (this would increase the available compensation for oil pollution from $405 million to $1.5 billion per incident); the 2001 Convention on Bunker Oil Pollution Damage; and the 1996 Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (this would provide a new liability regime for carriage of such substances). The proposed amendments also include a proposal to remove from the passenger liability regime (Part 4 of the MLA) certain types of vessels used mainly in adventure tourism.

MARINE ATLANTIC ADVISORY COMMITTEE

In November 2004, an advisory committee was formed to study a wide range of issues and identify long-term strategies for stabilizing Marine Atlantic's ferry service operations. The Committee held consultations with stakeholders and with representatives from Marine Atlantic in January 2005. In March 2005, the Committee provided the Minister of Transport a final report covering all aspects of its mandate and including 41 recommendations for improving the ferry service. The recommendations were in the areas of operations and service, fleet configuration and renewal and long-term funding and pricing strategies. There were three key recommendations: eliminate the drop-trailer service; plan for a three-vessel fleet composed of larger ferries purpose-built for the service; and based on estimated operational savings (over 14 years) from these two initiatives, roll-back rates by 15 per cent. On November 15, 2005, the Government of Canada announced its decision to continue the droptrailer service provided that the level of cost recovery for the service is acceptable; the service is handled more efficiently by Marine Atlantic; and the trucking industry improves efforts to work with Marine Atlantic on initiatives to better manage traffic demand. Transport Canada continues to work with Marine Atlantic to develop a longterm strategy that will consider important elements such as rates structure, governance and fleet requirements.

NATIONAL MARINE AND INDUSTRIAL COUNCIL

The National Marine and Industrial Council (NMIC) was established in 2004. The industry's primary objective for this industry–government forum is to raise the profile of Canada's marine transportation as an economic generator. The Council also provides a venue for discussing marine policy issues with leaders from the marine industry and deputy ministers of departments that have direct influence on the marine transportation sector. Key issues being discussed cut across several federal departments and include competitiveness, security, innovation and infrastructure.

The Council is made up of industry executives, including cargo shippers, domestic and international shipowners, port operators and marine service providers from across the country, and federal government senior officials, including the deputy ministers of Transport Canada, Industry Canada, Fisheries and Oceans Canada, International Trade Canada and Environment Canada. The inaugural meeting of the NMIC took place on May 31, 2004. The Council holds meetings bi-annually.

SHORTSEA SHIPPING FOR INCREASING INTERMODALITY

Following the successful 2004 National Marine Conference on Shortsea Shipping in Montreal, Transport Canada continued efforts in 2005 to promote shortsea shipping opportunities as a means to help alleviate congestion, strengthen intermodalism, improve utilization of waterway capacity, facilitate trade and reduce greenhouse gas emissions — in other words, to increase the efficiency of the overall transportation system.

Transport Canada continued to pursue the promotion of shortsea shipping through a 2003 Memorandum of Cooperation with the United States and Mexico. The memorandum intends that North American transportation authorities would cooperate in exchanging information and experiences on shortsea shipping. Transport Canada also undertook several studies and initiatives to understand and assess the opportunities, challenges, policy considerations and overall state of shortsea shipping in Canada, whether on the west or east coast, the St. Lawrence Seaway, the Great Lakes or in the Arctic. Furthermore, Transport Canada continued to be an active member of the Quebec Shortsea Shipping Roundtable. This roundtable works to create a clearinghouse for information and expertise, communicate information to stakeholders, and promote and support shortsea shipping projects.

CANADA MARINE ACT

In June 2005, Bill C-61, "An Act to amend the Canada Marine Act (CMA) and other Acts," was introduced in Parliament. The proposed amendments follow the tabling of a June 2003 report pertaining to the first five years of operation of the Act. C-61 fine-tuned the existing provisions and provided Canada Port Authorities (CPAs) with access to federal funding for certain infrastructure projects (to a capped amount) and national security. Bill C-61 was complemented by other policy initiatives aimed at maximizing the efficiency of the marine sector and strengthening its role in Canada's international trade. With the dissolution of the 38th Parliament in November 2005, Bill C-61 died on the order paper.

Passenger Transportation

Freight Transportation