January 9, 2006

New EA rules would create alternative process for BDC, FCC

Proposed new regulations under the Canadian Environmental Assessment Act will create a varied environmental assessment (EA) process for Crown corporations involved in providing commercial loans, specifically the Business Development Bank of Canada (BDC) and Farm Credit Canada (FCC). The proposed Crown Corporations Involved in the Provision of Commercial Loans Environmental Assessment regulations follow up on amendments made in June 2003 to the EA Act requiring federal parent Crown corporations to conduct EAs of their projects, either by direct compliance with the Act or by a modified environmental assessment process set in regulations. This provision takes effect June 11, 2006.

While the proposed regulations preserve to the fullest extent possible the EA process prescribed by the EA Act, they recognize that both BDC and FCC would be unable to comply with specific elements of the act, particularly those related to the Canadian Environmental Assessment Registry. Direct compliance with the EA Act would, in fact, compromise the competitiveness of FCC and the ability of both BDC and FCC to conduct their core business, as it would breach client confidentiality requirements and impede the timely delivery of services.

Accordingly, the proposed regulations would:

*modify public notification requirements to respect client confidentiality and protect commercially sensitive and personal information;

*exempt BDC and FCC from a mandatory 15-day period between the posting of the notice of commencement of the environmental assessment and the description of the scope of the project and their decision. This will enable the BDC and FCC to continue conducting their core business to continue in a timely manner and will maintain the ability of FCC to compete and BDC to complement private chartered financial institutions;

*require BDC and FCC to post on the Registry Internet site a quarterly statement of their projects assessed under the Act; and

*require BDC and FCC to post their environmental assessment policies, procedures and guidance materials (including any forms used in the assessment of projects) on the Registry Internet site to enhance transparency and offset the fact that the regulations represent a departure from existing notification requirements prescribed by the Act. (The Agency will be making draft versions of these documents available for public comment within the next few weeks.)

Other requirements and procedures of the EA Act would still apply to the BDC and FCC, such as definitions, triggers, factors to be considered, the discretion of the Responsible Authority to invoke public participation in the conduct of a screening, decisions to be made following an assessment, the powers of the federal Environment Minister and the potential for assessment by a panel review or mediation.

The proposed amendments, based on extensive consultations with BDC and FCC, were published in the Canada Gazette, Part 1 on December 31, 2005 for a 30-day comment period ending January 30, 2006. Comments, in either official language, may be sent to M John Smith director, legislative and regulatory affairs Canadian Environmental Assessment Agency 160 Elgin St, 22nd Floor Ottawa K1A 0H3, 613/948-1942, FAX 613/957-0897, E-mail john.smith@ceaa-acee.gc.ca. More information, including a link to the Canada Gazette, Part I site is available on the Agency's Web site, www.ceaa-acee.gc.ca.

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