Environmental Enforcement Statute Law Amendment Act, 2005
In June 2005, the Ontario government passed the Environmental Enforcement Statute Law Amendment Act (EESLAA) and proclaimed into force certain sections of the new law. This Act, also known as Bill 133, follows through on the government’s “you spill, you pay” promise to Ontarians that was made after several high profile spills occurred along the St. Clair River in 2003 and 2004.
The EESLAA is part of an evolution of environmental law in Ontario and expands the Ministry of the Environment’s powers to deal with industrial polluters in a number of important ways. In addition, the EESLAA addresses some of the concerns and issues that were raised by the Industrial Pollution Action Team (IPAT) in its July 2004 report to the Minister of the Environment. IPAT was created by MOE in April 2004 after several spills occurred along the St. Clair River that angered local communities in both Ontario and Michigan which were required to shut down their water treatment systems, but not always adequately informed of the risks. IPAT based its analysis and recommendations on the belief that “affected communities must be fully and meaningfully involved in all decisions that affect their environment and their health.” On July 30, 2004, IPAT released its findings regarding the causes of industrial spills and dangerous air emission and its recommendations on preventive measures that industry and others could undertake. IPAT found that Ontario’s environmental management framework was “largely reactive, not preventive” and that there were no regulatory requirements for pollution and spill prevention plans, although MOE had attempted to develop pollution prevention plans with several industry sectors in the 1990s.
In a May 2005 presentation on Bill 133, the Minister of the Environment indicated that there was one key objective for the bill – to reduce the number of spills in Ontario by “encouraging companies to do more to prevent spills and to ensure fast, effective cleanup when mishaps do occur.” The minister noted that despite the threat of prose cution, some companies had not taken the steps needed to prevent spills. In 2004, approximately 3,900 spills were reported to MOE, of which industrial facilities accounted for 1,062 spills, or 27 per cent.
Many key sections of the EESLAA were proclaimed on June 13, 2005. One of them ha expanded on the provisions in the Environmental Protection Act (EPA) that require directors and officers of corporations to take “all reasonable care” to prevent the corporation from causing or permitting the discharge of a contaminant into the natura environment in contravention of the EPA or its regulations. For instance, one of their additional duties is to notify MOE of discharges of contaminants in contravention of the EPA, its regulations or an approval under the EPA. Similar amendments were also made to the Ontario Water Resources Act (OWRA).
The EESLAA also included numerous other amendments that have come into force such as lowering the threshold in the EPA – e.g., from ”likely” to “may” – for certain provision to be applicable, expanding on the criteria for determining if water is impaired unde the OWRA, increasing the maximum daily penalties for offences under the EPA and OWRA, and shifting the burden of proof obligations from MOE to the polluters. Ther are also amendments that provide additional direction to the courts regarding sentencin Many sections of the EESLAA have not been proclaimed as of May 2006. Under the new law, MOE can impose financial penalties, called environmental penalties (EPs), on regulated persons for contraventions related to the EPA and/or the OWRA. EPs replace the administrative penalty provisions in the EPA and the OWRA, which were never proclaimed. The EESLAA includes provisions that identify the types of contra- ventions for which EPs can be imposed, the maximum daily amounts of EPs that can be imposed, and the appeal rights and burden-of-proof obligations related to EPs. But as of May 2006, none of the EP provisions had come into force.
Public participation and the EBR process
Bill 133 was introduced in the Ontario Legislature on October 27, 2004, and MOE provided an initial 30-day Registry comment period. MOE had provided an earlier period of policy consultation between April and September of 2004 related to work of the IPAT. After requests from the ECO and other stakeholders in mid-November 2004, MOE increased the comment period to 71 days. (For additional comments, see pages 170-171, Adequate time to comment on proposed Acts.)
Since MOE had not posted a Registry decision notice by the time this article was completed in late May 2006, the ECO is uncertain as to exactly how many comments were submitted. Based on an electronic version of the comments provided to the ECO in May 2006, it appears that more than 160 comments were submitted during the comment period.
Commenters were either strongly for Bill 133 or strongly against it. Supporters included environmental groups, such as the Canadian Environmental Law Association (CELA), the Sierra Legal Defence Fund, the Lake Ontario Waterkeeper and the Wallaceburg Advisory Team for a Cleaner Habitat. In contrast, dozens of mining, forestry and petrochemical companies and industry associations, such as the Ontario Mining Association and the Canadian Petroleum Producers Association, had numerous concerns about Bill 133.
Most environmental groups supported the use of environmental penalties, and noted that EPs have been used effectively in other jurisdictions in Canada and the U.S. However , CELA cautioned that EPs should not be considered as a replacement for prosecutions, noting that legal commentators who have examined the role of prosecutions as a regulatory tool have concluded that an emphasis on prosecutions has served as a powerful catalyst in promoting regulatory compliance.
Commenters who supported Bill 133 also urged the government to require agreements to settle disputes about EPs (or reduce or even cancel them) to be made public, to require that companies prepare pollution and spill prevention plans, and that the ministry produce annual reports on the use of EPs, investigations and prosecutions. In addition, supporters agreed with MOE’s plans that the Bill 133 requirements should apply only to Municipal-Industrial Strategy for Abatement (MISA) facilities initially and then to other sectors based on their spill records. They also praised the proposed amendments that reduced the threshold for prosecutions from “likely to cause” to “may cause” under the EPA, observing that these amendments would make the threshold under the EPA consistent with the existing threshold in the OWRA. They also supported the proposed definition of “deemed impaired,” citing the problems encountered by MOE prosecutors in proving impairment of water since R. v. Inco was decided by the Ontario Court of Appeal in 2001.
Commenters who expressed concerns felt there was a lack of consultation prior to the release of Bill 133 and the targeting of the MISA facilities, which are already regulated, rather than other sectors, including the public sector. In addition, they believed that Bill 133 would deter future economic development in Ontario. Opponents to Bill 133 were very concerned with the proposed amendments to change “likely” to “may” in the EPA since they argued that “may” cannot be measured and would undermine the scientific basis for conditions in certificates of approval. They were particularly concerned with the proposed amendments that would require companies to prove compliance instead of the ministry’s having to prove that they were not in compliance. They were also concerned that companies would not be allowed to use a due diligence defence before the Environmental Review Tribunal. Some opponents were concerned that proposed amendments to hold directors and officers of companies accountable were out of line with good business standards and believed that Bill 133 would result in numerous and lengthy court challenges.
The lack of a due diligence defence for EPs attracted criticism from many companies, industry associations and the Ontario Bar Association (OBA). In its comments on the Registry proposal, the OBA said that “ … it is our strong view that there should be a defence of due diligence available to both individuals and corporations with respect to EPs. Some minimum requirement of fault would strike a better balance between fairness and the compelling need to protect our environment.” Thus, they recommended that MOE reconsider its proposal.
ECO Comment
The EESLAA responds to a number of concerns that the ECO and other stakeholders have raised with MOE, and the ministry should be commended for its work on Bill 133. However the effectiveness of the legislation is compromised by the lack of resources for compliance staff to work with companies on compliance issues and to enforce the statute, especially because the ECO anticipates that the number of reported spills to increase now that all spills, even those that do not result in adverse effects, must be reported unless exempted by regulation. The ECO also expects that MOE will impose more preventive orders that include requirements to develop plans to reduce the number of spills and discharges to the natural environment and to decrease the adverse effects of spills.
The ECO noted in our 1997 annual report that a good understanding of spills occurrence trends can be used to target problem areas and focus prevention programs. At the time we expressed concern that a reduction in the reporting of spills could compromise MOE’s ability to monitor the total volume of spills, to understand and model cumulative impacts, and to identify chronic sources of small spills. We also stated that MOE’s focus on setting quantity limits for exempting spills within specific industries was inappropriate because the type of contaminant and the circumstances of a spill must also be considered. To this end, the changes in the Environmental Enforcement Statute Law Amendment Act are positive because they emphasize the importance of forcing industry and regulators to focus their attention on spills and their adverse effects.
The ECO believes that the changes in the EESLAA that potentially could lead to greater liability (e.g., the change from “likely” to “may” in some sections) will probably induce industries to re-think their industrial processes in order to minimize the discharges of contaminants that are taking place. The increased prospect of a penalty for unlawful discharges of contaminants should also induce some companies and industries to re-examine their processes and begin to implement pollution prevention and product redesign and to employ leading technologies like closed-loop industrial waste processes.
In our 2001/2002 annual report, the ECO urged MOE to amend s.30(1) of the OWRA to clarify that the Crown need only prove that the discharged material itself may impair, as in the case of s.36(3) of the Fisheries Act, absent any consideration of the actual discharge or the receiving water body. The ECO is pleased that MOE has responded to this concern.
The ECO also strongly supports the development of EPs by MOE. Environmental penalties will provide MOE with a tool to address spills promptly as well as a broad range of non-compliance situations. As noted in the ECO’s 1999/2000 annual report, EPs provide a number of advantages over prosecution. They can provide regulators with a more expeditious, less resource-intensive and less costly means of bringing violators into compliance. Despite concerns that MOE will retain enormous discretion on how EPs are administered and revoked, the ECO regards EPs as important additional tools for achieving compliance with the province’s environmental laws. At the same time, the ECO recognizes that it is essential that MOE clearly define those circumstances when EPs will be utilized and when the ministry will proceed with enforcement action.
In response to requests from environmental groups, MOE agreed to publish on the Registry every agreement made to reduce or cancel an EP. The provisions to publish settlement agreements and an annual report and to conduct a five-year review of the program will ensure that MOE’s implementation of environmental penalties is transparent. It isn’t clear whether MOE intends to post the agreements as regular notices subject to s. 15(1) of the EBR or as information notices under s. 6 of the EBR. Since the EP regulation is still under development, the ECO will reserve further comment until the regulation is passed.
When ministries post notices of environmentally significant proposals for Acts on the Registry, they must also post notices of their decisions on those proposals, along with explanations of the effect of public comment on their final decisions. In this case MOE failed to post a decision notice promptly. As of May 2006, MOE still had not posted a decision notice for Bill 133, nearly one year after the bill had been passed into law. Moreover, MOE also failed to provide comments submitted through the Registry consultation process to the ECO until early May 2006. (For further discussion, see Ministry Cooperation, pages 203-205.)
In conclusion, the Environmental Enforcement Statute Law Amendment Act represents an important shift in the Ministry of the Environment’s approach to regulating industrial polluters. The ECO will carefully monitor how the new environmental penalties and other facets of the law are administered and will provide updates in future annual reports. (For a more detailed review of this issue, see the Supplement to this report, pages 102-115.)
| This is an article from the 2005/06 Annual Report to the Legislature from the Environmental Commissioner of Ontario. |
Citing This Article:
Environmental Commissioner of Ontario. 2006. "Bill 133: Putting the Lid on Spills." Neglecting our Obligations, ECO Annual Report, 2005-06. Toronto, ON : Environmental Commissioner of Ontario. 103-107.
