Vol. 148, No. 22 — October 22, 2014

Registration

SOR/2014-233 October 10, 2014

RAILWAY SAFETY ACT

Railway Safety Administrative Monetary Penalties Regulations

P.C. 2014-1022 October 9, 2014

His Excellency the Governor General in Council, on the recommendation of the Minister of Transport, pursuant to section 40.1 (see footnote a) and subsection 40.11(2) (see footnote b) of the Railway Safety Act (see footnote c), makes the annexed Railway Safety Administrative Monetary Penalties Regulations.

RAILWAY SAFETY ADMINISTRATIVE MONETARY PENALTIES REGULATIONS

INTERPRETATION

Definition of “Act”

1. In these Regulations, “Act” means the Railway Safety Act.

DESIGNATED PROVISIONS

Designated provisions

2. (1) A provision of the Act or its regulations that is set out in column 1 of a Part of Schedule 1 is designated as a provision the contravention of which may be proceeded with as a violation in accordance with sections 40.13 to 40.22 of the Act.

Maximum amounts — individuals

(2) The amount set out in column 2 of a Part of Schedule 1 is the maximum amount payable by an individual in respect of a violation of the designated provision set out in column 1.

Maximum amounts — corporations

(3) The amount set out in column 3 of a Part of Schedule 1 is the maximum amount payable by a corporation in respect of a violation of the designated provision set out in column 1.

Designations — orders and rules

3. (1) The following instruments are designated as provisions the contravention of which may be proceeded with as a violation in accordance with sections 40.13 to 40.22 of the Act:

Maximum amounts

(2) The maximum amount payable for a violation referred to in subsection (1) is $25,000 in the case of an individual and $125,000 in the case of a corporation.

PRESCRIBED FORM OF ENFORCEMENT OFFICER CERTIFICATE

Enforcement Officer Certificate

4. The authorization referred to in subsection 40.11(2) of the Act shall be in the form set out in Schedule 2.

COMING INTO FORCE

April 1, 2015

5. These Regulations come into force on April 1, 2015.

SCHEDULE 1
(Section 2)

PART 1

DESIGNATED PROVISIONS OF THE ACT

Item Column 1



Designated Provision		 Column 2

Maximum Amount Payable ($)

Individual		 Column 3

Maximum Amount Payable ($)

Corporation
1. Subsection 7(2.1) 25,000 125,000
2. Subsection 8(1) 25,000 125,000
3. Subsection 10(1) 25,000 125,000
4. Subsection 11(1) 50,000 250,000
5. Subsection 11(2) 50,000 250,000
6. Section 17.2 50,000 250,000
7. Section 17.3 50,000 250,000
8. Subsection 19(2) 5,000 25,000
9. Subsection 20(1) 5,000 25,000
10. Subsection 20(2) 5,000 25,000
11. Subsection 23.1(1) 5,000 25,000
12. Subsection 30(1) 25,000 125,000
13. Subsection 30(2) 25,000 125,000
14. Section 31 50,000 250,000
15. Subsection 32(1) 50,000 250,000
16. Subsection 32(3) 50,000 250,000
17. Subsection 33(1) 50,000 250,000
18. Subsection 35(1) 25,000 125,000
19. Subsection 35(3) 25,000 125,000
20. Section 36 50,000 250,000
21. Section 38 50,000 250,000
22. Subsection 44.1(1) 5,000 25,000
23. Subsection 44.1(2) 5,000 25,000
PART 2

DESIGNATED PROVISIONS OF THE RAILWAY SAFETY MANAGEMENT SYSTEM REGULATIONS

Item Column 1



Designated Provision		 Column 2

Maximum Amount Payable ($)

Individual		 Column 3

Maximum Amount Payable ($)

Corporation
1. Section 2 50,000 250,000
2. Subsection 3(1) 25,000 125,000
3. Subsection 3(2) 25,000 125,000
4. Subsection 4(1) 5,000 25,000
5. Paragraph 4(2)(b) 5,000 25,000
6. Subsection 5(1) 5,000 25,000
7. Section 6 25,000 125,000
PART 3

DESIGNATED PROVISIONS OF THE MINING NEAR LINES OF RAILWAYS REGULATIONS

Item Column 1



Designated Provision		 Column 2

Maximum Amount Payable ($)

Individual		 Column 3

Maximum Amount Payable ($)

Corporation
1. Section 4 50,000 250,000
2. Subsection 5(1) 25,000 125,000
3. Subsection 5(2) 25,000 125,000
4. Section 6 25,000 125,000
5. Section 8 50,000 250,000
PART 4

DESIGNATED PROVISIONS OF THE RAILWAY PREVENTION OF ELECTRIC SPARKS REGULATIONS

Item Column 1



Designated Provision		 Column 2

Maximum Amount Payable ($)

Individual		 Column 3

Maximum Amount Payable ($)

Corporation
1. Section 3 50,000 250,000
2. Subsection 5(1) 25,000 125,000
3. Subsection 5(2) 25,000 125,000
4. Subsection 5(3) 25,000 125,000
5. Section 6 25,000 125,000

SCHEDULE 2
(Section 4)

ENFORCEMENT OFFICER CERTIFICATE

ENFORCEMENT OFFICER CERTIFICATE
Certificate Number: _________________
Pursuant to subsection 40.11(1) of the Railway Safety Act, …………………………(NAME) ………………………… is designated as an enforcement officer to exercise the powers conferred to an enforcement officer under that Act.
Signature of Minister or Minister’s delegate:
_______________________________
Date of issuance: _______________________________

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

The Minister of Transport’s rail safety enforcement powers under the Railway Safety Act (the Act) need to be strengthened. The Act has been modernized and enhanced through the introduction of a regulation-making authority to provide for administrative monetary penalties (AMPs). This would complement the existing railway safety oversight regime, providing a full set of tools to the Minister to effectively deal with safety enforcement. Currently, the strongest enforcement action available to the Minister of Transport in cases of non-compliance is prosecution. Administrative monetary penalties would provide the Minister with an additional enforcement option and an alternative to prosecution. An administrative monetary penalty scheme is a more rapid and less costly means of enforcing legislative requirements than prosecution, because it uses administrative, rather than criminal, processes. Moreover, this is consistent with the principles of minimizing the regulatory burden on Canadians, while promoting regulatory compliance.

The Railway Safety Administrative Monetary Penalties Regulations (the Regulations) are needed to designate provisions and set out maximum payable penalties for each designated provision in cases of non-compliance, as well as the certificate for enforcement officers.

Background

In its 2008 report “Stronger Ties,” the advisory panel for the Railway Safety Act review recommended provisions to strengthen the Minister’s enforcement powers by introducing administrative monetary penalties. Similarly, the 2008 report of the Standing Committee on Transport, Infrastructure and Communities (SCOTIC) supported the recommendation that the Department adopt administrative penalties for companies that violate safety rules.

Based on these recommendations, the Act was amended on May 1, 2013, to provide the Governor in Council with the authority to make regulations designating provisions of the Act and any regulations and other instruments made under the Act as designated provisions, that the contravention of which could lead to the issuance of an administrative monetary penalty, and setting the maximum amount payable for any penalty.

The facts of an alleged violation or the amount of a penalty would be reviewable by the Transportation Appeal Tribunal of Canada (TATC).

Objectives

The objective of the Regulations is to provide the Minister of Transport with necessary enforcement tools.

The contravention of designated provisions or other instruments may subject the regulated stakeholder to administrative monetary penalties. This authority not only provides the Minister with more effective enforcement tools, it also aligns enforcement of the Act and its subordinate instruments with the enforcement regimes currently granted and exercised by the Minister under such regimes as the Aeronautics Act, the Canada Shipping Act, 2001, the Marine Transportation Security Act, the Canada Marine Act, the Canada Transportation Act, and the International Bridges and Tunnels Act.

Description

The Regulations include schedules that set out which provisions of the Act and its subordinate instruments are designated. There is one schedule for each of the following: the Railway Safety Act, the Mining Near Lines of Railways Regulations, the Railway Prevention of Electric Sparks Regulations, and the current Railway Safety Management System Regulations.

Schedule 1 prescribes the maximum payable amount for each designated provision. There are three distinct maximum payable amounts reflecting the level of significance of each designated provision measured by the seriousness of the consequences or potential consequences of the contravention. The three maximum payable amounts reflect low-risk violations of administrative-type provisions, medium-risk safety violations, and major safety violations that pose the highest risk to safety (see table below).

Rules in force under section 19 or 20 of the Act are designated as a whole, because they are of considerable regulatory significance. The maximum payable amount for a violation of a rule made under these sections is $125,000 for a corporation and $25,000 for an individual.

The penalties for a violation are as follows:

Column 1 Column 2 Column 3
  Maximum Penalty /
Amount Payable ($)		 Maximum Penalty /
Amount Payable ($)
Level of Risk Individual Corporation
Category A
If violation is low-level risk		 5,000 25,000
Category B
If violation is medium-level risk		 25,000 125,000
Category C
If violation is high-level risk		 50,000 250,000

Examples of designated provisions of the Act and the maximum payable amounts prescribed in the Regulations include

Examples of designated provisions of the Mining Near Lines of Railways Regulations include

Examples of designated provisions of the Railway Prevention of Electric Sparks Regulations include

Examples of designated provisions of the current Railway Safety Management System Regulations include

Under the Act, any recipient of an AMP may request from the TATC a review of the facts of an alleged violation or the amount of the penalty. Transport Canada or the recipient of an AMP may appeal the results of the initial review to the TATC for final determination. The TATC review process is less formal than court proceedings. Thus, an AMP regime is relatively inexpensive to administer within an existing compliance program, and it normally results in more timely and effective enforcement than prosecution.

The Regulations specify that they will come into force on April 1, 2015.

“One-for-One” Rule

The “One-for-One” Rule does not apply to the Regulations, as there is no change in administrative burden.

Small business lens

The small business lens does not apply to the Regulations, as no incremental costs will be imposed on small businesses that comply with the Act and its subordinate instruments.

Consultation

In February 2014, Transport Canada consulted with the following stakeholders on the Regulations:

Industry has been aware of these Regulations since they were recommended in the 2008 Railway Safety Act Review.

Comments and questions from stakeholders touched on what regulatory instruments would be included in the Regulations, use of the terms “individual” and “person” in the Regulations, whether an AMP could be withdrawn after having been issued, and the categorization of provisions into low, medium, and high risk. In response, Transport Canada provided answers and explanations to each concern through further dialogue with stakeholders.

The Regulations were published in the Canada Gazette, Part I, on May 17, 2014, followed by a 30-day comment period during which Transport Canada received three comments from stakeholders, specifically:

1. Industry stakeholders commented that the authority and the procedures for enforcement officers to issue notices of violation were not addressed in the Regulations. The concern related to whether notices of violation would be issued in the field. However, there is no authority in the Railway Safety Act to regulate the matter of enforcement officers. The powers and role of enforcement officers are established in the Act itself. The procedure to issue notices of violation has been set by Transport Canada’s Rail Safety policy team, and stakeholders were consulted on this policy and the proposed procedure.

2. Industry stakeholders would like to be sure that sufficient criteria will be applied when determining whether to issue a notice of violation. While this comment does not pertain directly to the Regulations per se, this matter cannot be regulated because the Act does not authorize regulations to be made on this subject matter. The criteria to determine when to issue a notice of violation have been set by Transport Canada’s Rail Safety policy team. Stakeholders have been consulted on the criteria to be applied in determining whether to issue a notice of violation. Moreover, the criteria are consistent with the criteria of other well-established AMP regimes.

3. Two separate comments were received with respect to designating rules in paragraph 3(1)(b) of the Regulations. Stakeholder comments observed that Item 6 of the designated provisions table of the Railway Safety Act designates section 17.2 of the Act, which requires, among other things, that all companies operate in accordance with rules. Stakeholders recommended that paragraph 3(1)(b) of the Regulations be removed, expressing the concern that a violation may be simultaneously subject to two designated provisions, allowing for an ultimate penalty to exceed the maximum payable amount set by the Act. Transport Canada has not made this change to the Regulations for the following three reasons: two notices of violation would never be issued for the same violation and the maximum payable amount for a penalty established in the Act cannot be exceeded; paragraph 3(1)(b) provides greater clarity of application because it pertains directly to the contents of the rules rather than a single general provision of the Act, and; section 17.2 of the Railway Safety Act is to remain designated because it will, once recent amendments to the Act come into force, include the obligation on a company to operate in accordance with its railway operating certificate.

Following publication in the Canada Gazette, Part I, a review of the French provisions of the Railway Safety Act determined that the form for the authorization of enforcement officers must be prescribed by regulation. Because this is an internal administrative issue, Transport Canada did not consult with stakeholders. The Railway Safety Administrative Monetary Penalties Regulations have been revised to include the certificate for enforcement officers, as per subsection 40.11(2) of the Railway Safety Act.

Rationale

The introduction of the Regulations would benefit the Canadian public by allowing Transport Canada to enforce requirements using an administrative process rather than resorting to prosecution in the courts. Criminal proceedings often result in considerable costs to the federal government and to the individual and/or corporation involved, and may be too harsh a tool to utilize except in extreme circumstances. The Regulations would supplement enforcement tools available to the Minister of Transport, increasing rail safety and public confidence in Canada. Furthermore, the Regulations would prescribe the form and content of the certificate authorizing Transport Canada personnel as enforcement officers for the purposes of determining compliance with designated provisions, as well as for issuing an AMP.

All government departments, and more specifically Transport Canada, have adopted what is termed a progressive or graduated approach to the compliance or enforcement activities under their authority. Where AMPs are an enforcement option, they are invariably suggested as a complement or supplement to other compliance and enforcement tools. AMPs can be used as an alternative to prosecution, which would be a significant cost saving to both government and regulated stakeholders, depending on the gravity of the circumstances, the character of the offender or other considerations particular to the specific event.

Transport Canada’s Rail Safety Program will continue to apply the principles of proactive compliance with a graduated enforcement regime, and the introduction of AMPs are the most effective tool to enhance and complete the compliance continuum.

The objectives of the Act include the promotion and provision of safety and security to the public and personnel, the protection of property and the environment in railway operations, the recognition of the responsibility of companies to demonstrate that they continuously manage risks related to safety matters, and the facilitation of a modern, flexible and efficient regulatory scheme that will ensure the continuing enhancement of railway safety and security.

The AMP regime is an additional enforcement tool to promote and ensure compliance with the legislative framework of the Act, and is an alternative to prosecution.

Implementation, enforcement and service standards

The Regulations do not add any new requirements; they simply create an additional tool for enforcing the Act and its associated instruments. AMPs will therefore be integrated into the existing graduated enforcement policy of Transport Canada’s Rail Safety Program.

To ensure that AMPs will be applied in a fair, impartial, predictable and nationally consistent manner, appropriate training programs will be developed and implemented. This training will ensure that Rail Safety officials take a similar approach in similar circumstances to achieve similar results. For initial implementation of the Regulations, AMPs will be recommended to management following an established process developed by the Rail Safety Program, with several layers of management endorsement and approval to ensure fairness, predictability, and national consistency.

Contact

Any questions related to the Railway Safety Administrative Monetary Penalties Regulations should be directed to

Susan Archer
Director
Regulatory Affairs
Transport Canada
Telephone: 613-990-8690
Email: susan.archer@tc.gc.ca