Supreme Court Rules Against Federal Impact Assessment Law
Canada’s highest court has finally delivered a much-anticipated judgment, asserting in a majority opinion that Ottawa’s Impact Assessment Act (IAA) is largely unconstitutional.
Formerly known as Bill C-69, the IAA, established in 2019, empowers federal regulators to evaluate the potential environmental and social impacts of various resource and infrastructure projects. This law has been a source of significant controversy, particularly among conservative politicians in Alberta, such as former Premier Jason Kenney, who often derisively referred to it as the “no more pipelines act.”
This momentous ruling was part of a “reference case,” in which provincial and federal governments sought advisory opinions from the courts. It’s important to note that this ruling doesn’t immediately void the law. However, historically, decisions from the Supreme Court of Canada are treated as binding by governments, despite not being legally binding.
Chief Justice Richard Wagner, writing for the majority in a 5-2 decision, affirmed the constitutionality of Sections 81 to 91 of the IAA. These sections pertain to projects carried out or financed by federal authorities on federal lands or outside Canada, falling under federal jurisdiction and remaining uncontested.
However, Wagner deemed the rest of the IAA, relating to “designated projects,” unconstitutional. Designated projects are those outlined in the regulations or subject to a ministerial order. In his words, “Parliament has plainly overstepped its constitutional competence in enacting this designated projects scheme.”
Wagner emphasized that while environmental protection is of paramount importance, Parliament must operate within the constitutional division of powers outlined in the Constitution.
Dissenting Justices Andromache Karakatsanis and Mahmud Jamal believed the act was constitutional in its entirety. They argued that environmental protection is a shared responsibility among all levels of government in a federal state like Canada, acknowledging the necessity of intergovernmental cooperation.
Before this ruling, Alberta had already challenged the act, supported by the governments of Saskatchewan and Ontario, as well as three First Nations and the Indian Resource Council. Conversely, various environmental and legal groups, along with other First Nations, supported the federal government’s stance. A previous court decision had labeled the IAA an “existential threat” to Canada’s Constitution.
The federal government appealed this non-binding opinion, leading to the Supreme Court’s recent hearings and the eagerly awaited decision. The outcome was surprising to many legal experts following the case.
In essence, the majority’s decision declared the act as an example of federal overreach but affirmed the federal government’s authority to enact environmental assessment legislation. The verdict sets a significant precedent for federal impact assessment in the years ahead.
Following the ruling, Alberta Premier Danielle Smith celebrated it as a substantial win for the protection of provincial rights. She expressed a desire for the federal government to recognize exclusive provincial jurisdiction under the Constitution and collaborate on shared priorities.
Kenney also welcomed the decision, considering it a historic victory for Alberta. He expressed skepticism about the federal government’s suggestion of amending the act and called for greater collaboration with the provinces.
Reactions to the decision came from across the country, with Ontario Premier Doug Ford expressing his support. Conservative Leader Pierre Poilievre saw the ruling as positive and pledged to repeal and replace the law if elected. The Canadian Association of Petroleum Producers (CAPP) welcomed the decision and expressed readiness for collaboration on projects of national interest.
The Mining Association of Canada said it “will be working with its members to carefully analyze” the court’s decision, adding a call to Ottawa and the parliament to “respond to the Supreme Court of Canada opinion expeditiously to shorten the period of investment uncertainty.”
Ecojustice, an environmental law charity, found the weakening of an essential environmental law disappointing but remained hopeful about the future of environmental assessment processes.
Federal Environment Minister Steven Guilbeault and Energy and Natural Resources Minister Jonathan Wilkinson affirmed Ottawa’s commitment to respecting the Supreme Court’s guidance and improving the legislation in collaboration with the provinces.
“Today, we accept the Court’s opinion, which provides new guidance on the Impact Assessment Act, while explicitly affirming the right of the Government of Canada to put in place impact assessment,” Guilbeault said in a statement.
As the dust settles, there are 23 projects currently undergoing federal impact assessment under the IAA, with eight receiving final decisions to proceed. The implications of this ruling will continue to shape Canada’s environmental assessment landscape for years to come.
Information for this story was found via CBC and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
