Regulations Amending the Canadian Aviation Regulations (Parts I, VI and VII — Portable Electronic Devices) and Making a Related Amendment: SOR/2019-296

Canada Gazette, Part II, Volume 153, Number 17

Registration
SOR/2019-296 August 8, 2019

AERONAUTICS ACT

P.C. 2019-1141 August 7, 2019

Her Excellency the Governor General in Council, on the recommendation of the Minister of Transport, pursuant to paragraphs 4.9(m) ^{footnote a}, (o)^{footnote a} and (s) ^{footnote b} of the Aeronautics Act ^{footnote c}, makes the annexed Regulations Amending the Canadian Aviation Regulations (Parts I, VI and VII — Portable Electronic Devices) and Making a Related Amendment.

Regulations Amending the Canadian Aviation Regulations (Parts I, VI and VII — Portable Electronic Devices) and Making a Related Amendment

Canadian Aviation Regulations

1 Section 101.01 of the Canadian Aviation Regulations ^{footnote 1} is amended by adding the following in alphabetical order:

PED or portable electronic device means any lightweight, electrically powered electronic device capable of transmitting or producing electromagnetic signals; (PED ou appareil électronique portatif)

2 Part VII of Schedule II to Subpart 3 of Part I of the Regulations is amended by adding the following after the reference “Section 700.11”:

Column I Designated Provision	Column II Maximum Amount of Penalty ($)
	Individual	Corporation
Section 700.12	5,000	25,000
Section 700.12.1	3,000	15,000
Section 700.12.2	3,000	15,000

3 The reference “Subsection 703.38(3)” in column I of Subpart 3 of Part VII of Schedule II to Subpart 3 of Part I of the Regulations and the corresponding amounts in column II are repealed.

4 The reference “Subsection 704.33(5)” in column I of Subpart 4 of Part VII of Schedule II to Subpart 3 of Part I of the Regulations and the corresponding amounts in column II are repealed.

5 The reference “Subsection 705.40(4)” in column I of Subpart 5 of Part VII of Schedule II to Subpart 3 of Part I of the Regulations and the corresponding amounts in column II are repealed.

6 Subsection 602.08(1) of the Regulations is replaced by the following:

602.08 (1) No operator of an aircraft shall permit the use of a PED on board an aircraft if the use of the PED could adversely affect the operation of the aircraft or the functioning of the aircraft’s systems or equipment.

7 The Regulations are amended by replacing the reference “[700.12 reserved]” after section 700.11 with the following:

Division II.1 — Portable Electronic Devices

700.12 Despite subsection 602.08(1), an air operator that operates an aircraft under Subpart 3, 4 or 5 of Part VII may permit the use of a PED on board an aircraft if the air operator has validated that the use of the PED will not adversely affect the operation of the aircraft or the functioning of the aircraft’s systems or equipment during any phase of the flight.

700.12.1 An air operator that permits the use of a PED shall keep an up-to-date record of the following and provide a copy to the Minister on request:

• (a) the type, series and model of aircraft on which the air operator permits the use of a PED; and
• (b) for each aircraft referred to in paragraph (a), documents demonstrating that the use of a PED will not adversely affect the operation of the aircraft or the functioning of the aircraft’s systems or equipment during any phase of the flight.

700.12.2 If an air operator suspects that a PED whose use it has permitted may adversely affect, or is adversely affecting, the operation of an aircraft or the functioning of an aircraft’s systems or equipment, the air operator shall

• (a) immediately prohibit the use of the PED; and
• (b) as soon as practicable, submit to the Minister a report of the adverse effects on the operation of the aircraft or the functioning of the aircraft’s systems or equipment that are caused, or possibly caused, by the use of the PED.

8 Subsection 703.38(3) of the Regulations is repealed.

9 Subsection 704.33(5) of the Regulations is repealed.

10 Subsection 705.40(4) of the Regulations is repealed.

Regulations Amending the Canadian Aviation Regulations (Parts I, VI and VII — Flight Crew Member Hours of Work and Rest Periods)

11 Section 13 of the Regulations Amending the Canadian Aviation Regulations (Parts I, VI and VII — Flight Crew Member Hours of Work and Rest Periods) ^{footnote 2} is amended by replacing the reference “[700.12 to 700.18 reserved]” before the heading of Division III of Part VII that it enacts with the following:

[700.13 to 700.18 reserved]

Coming into Force

12 These Regulations come into force on the day on which they are registered.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Executive summary

Issues

Prior to the amendments, Canadian regulations and standards limited the use of PEDs on board aircraft and the limitations were not aligned with those of other foreign states. Exemptions have been issued and reissued since 2007 in order to align with the requirements of foreign states.

Canadian regulations were restrictive to air operators — over 55 exemptions have been issued by Transport Canada Civil Aviation since 2007

Under section 602.08 of the Canadian Aviation Regulations, Part VI — General Operating and Flight Rules, PEDs are permitted for use on board all aircraft in Canada, except when the PED may impair the functioning of the aircraft’s systems or equipment. However, for Canadian commercial operations, the requirements in Part VII of the CARs were further restrictive and prohibited an air operator from allowing the use of PEDs unless the air operator had established procedures that met the Commercial Air Services Standards (CASS) that were specified in their company operations manual. Because of the over-prescriptiveness and restrictions in the CARs and CASS, the industry relied heavily on exemptions.

Commercial Air Services Standards were inflexible and outdated

The CASS respecting PEDs have not been substantively amended since 1996 and do not reflect the advancements in technology since that time. The prescriptive nature of the CASS on how air operators were to handle PEDs did not provide the air operator the flexibility to manage them. For example, air operators had to provide a very detailed report on PED-related incidents (e.g. include details on weather conditions, the type of PED involved such as an FM radio) and report those incidents to a contact in Transport Canada that no longer exists (e.g. the Director of Aviation Safety). The CASS also contained provisions that specified devices that were prohibited at all times, but specified devices that were permitted to be used without restrictions and devices that were permitted to be used with restrictions. With the evolution of technology used in devices such as smart phones, activity trackers, eBooks, etc., and the ongoing evolution of different technologies, regulating specific devices would be too onerous as the list of permitted and forbidden devices could be outdated before revised standards are published.

Canadian regulations and standards did not align with other countries

The prescriptive approach that was set out in the CARs and CASS did not align with the approach taken by other foreign states. Internationally, the United States Federal Aviation Administration, the Civil Aviation Safety Authority of Australia, and the United Kingdom’s Civil Aviation Authority allow PEDs on board aircraft during all phases of flight. The regulations in these countries are outcome-based, permitting air operators to determine whether to allow the use of PEDs on board their aircraft with additional information on how to meet the requirements found in guidance material or advisory circulars. This gave Canada’s competitors the flexibility to test the safety and allow the use of new PEDs on board their aircraft if they wanted to.

Background

The regulations respecting PEDs have been in place since 1996, at a time when PEDs were not as ubiquitous as they are today. As a result of the limited number of PEDs that transmitted electronic signals, the regulations and, by extension, the CASS listed the various types of portable electronic devices that were allowed on board an aircraft (e.g. hearing aids), and those that were restricted (e.g. personal life support systems) while others were, by default, prohibited (e.g. cellular phones, music players) during critical phases of a flight. The regulations and CASS respecting PEDs have not been reviewed and updated since 1996 and as result of their prescriptiveness, exemptions had to be issued to provide relief to air operators as PED technology evolved. In Canada, the practice of allowing the expanded use of PEDs on board aircraft has been in place since 2007, via exemption. Since 2007, over 55 exemptions have been issued for PEDs.

Ministerial exemptions are made pursuant to subsection 5.9(2) of the Aeronautics Act which authorizes the Minister to grant exemptions from any provision of any regulation (e.g. the CARs), order or security measure made under Part I of the Act, where the Minister is of the opinion that granting the exemption will be in the public interest and will not adversely affect aviation safety or security. In practice, an exemption is an authorization that permits the requester to do something that is not in accordance with the regulations, orders or security measures governing aviation safety and security. In a request for an exemption, the person seeking it must demonstrate to the Minister how it would be in the public interest (i.e. passengers would be allowed to use their PEDs) and how that use will not adversely affect aviation safety or security. If the Minister is satisfied that this test has been met, he can grant the exemption and include any conditions that are necessary for the authorized activity to meet the public interest, safety and security requirements. Exemptions are not intended to replace the regulatory process but provide regulatory relief for a period of time (e.g. 18 months). If there are ongoing exemption requests for the same provision in the regulations, it may be an indicator that the regulations are too prescriptive or no longer operationally feasible. In this case, the regulations were both over-prescriptive and operationally not feasible as Canadian air operators were limited to only allowing the use of certain PEDs on board aircraft versus what their foreign counterparts were allowed.

Some exemptions were applied nationally to all air operators as they related to the use of PEDs during different phases of flight (e.g. taxiing in upon arrival at an air terminal). Any new aircraft being put into operation by a Canadian air operator that was not covered by an existing national exemption required air operators to apply for another exemption.

Other exemptions were applied individually to the aircraft type, series and model used by an air operator. Like national exemptions, individual ones prescribed the conditions that the air operators must follow if they wanted to allow PEDs on board their aircraft. These conditions included, for example, Transport Canada’s review and approval of PED test results prior to the air operator exercising the privilege of the exemption. As well, they had to have documented procedures in place in the event of an interference, and to report any interferences that occurred to the Minister of Transport. With the amendments, air operators no longer have to submit test results in advance to Transport Canada, and the department will not have to review and approve them. The air operator will, however, have to provide copies, upon request, of the documentation that they have that validates that the PEDs that they allow will not interfere with aircraft systems and equipment. The regulations continue to require air operators to have procedures in place in the event of a PED interference (i.e. inform passengers to turn them off during flight) and to report any suspected interferences to aircraft systems and equipment to the Minister of Transport.

The first aviation safety risk assessment related to the expanded use of PEDs on board commercial aircraft was conducted by Transport Canada in 2005 and was based on the technology at the time. The hazard statement was to determine if the use of transmitting PEDs (i.e. cellular phones) may interfere with aircraft systems that would impact the safety of the aircraft and its occupants. As a result of the low risk of interference, a national exemption permitting the use of transmitting PEDs (i.e. cellular phones) after landing and during the taxi-in-to-gate phase of a flight was issued.

Subsequent risk assessments were also conducted from 2011–2013 related to the various types of PEDs and their use (i.e. during fuelling, electronic cargo monitoring devices, and non-transmitting PEDs during critical phases of flight), all of which again resulted in the issuance of national exemptions for each, with conditions. The risk assessments included the review of various reports written in 1991, 1996, 2001 and 2008 by the Radio Technical Commission for Aeronautics (RTCA), the Federal Aviation Administration (FAA), and Boeing. Although dated, the technology and reliability of PEDs have changed significantly over time, the reports gave an in-depth review of the potential hazards of using PEDs in all phases of flight and acknowledged that adverse consequences would be more severe if PEDs were used during critical phases of flight. However, none of the reports specifically pointed to incidents resulting directly or indirectly from the use of PEDs. Based on the scientific data, Transport Canada concluded that, while there is a potential for interference with aircraft systems, the extent and severity of the interference is not quantifiable. As such, the reports erred on the side of caution because the data was inconclusive at the time. It is also known that PEDs are often inadvertently left on in all phases of flight with no negative consequences reported to date.

All of the above-noted risk assessments confirmed that various PEDs could be allowed safely on board aircraft, provided that additional controls were put in place by the air operator (e.g. asking passengers to turn off all PEDs if there was interference identified by the pilots). These controls were turned into conditions within the exemptions, as described in the paragraph above. Furthermore, additional exemptions were issued to air operators to allow the use of transmitting PEDs to support Wi-Fi on board aircraft and to allow for Bluetooth devices. Exemptions were originally renewed every 18 months. Since 2007, due to the large volume of the same exemptions being reissued, renewal of exemptions is required every 5 years.

Since 2007, in Canada, no incidents have been reported respecting direct interference with aircraft systems due to the use of PEDs on board Canadian aircraft. The area of concern relating to PEDs continues to be the risk of them catching fire due to lithium batteries, which does not relate to interference with aircraft systems. In respect to the issue of lithium batteries, Transport Canada, via the Transportation of Dangerous Goods Regulations has banned lithium batteries from checked baggage and cargo and the Civil Aviation Directorate has issued several safety bulletins addressing this issue.

In the United States, the 2018 report from the United States Aviation Safety Reporting System identified potential PED interference with aircraft systems on occasion; however, all suspected instances were addressed with existing airline safety protocols in place (i.e. asking passengers to turn them off). It is, therefore, concluded that, although there is potential for PED interference, the risk continues to remain low for any severe interference with aircraft systems.

As part of the Fall Economic Statement 2018 (FES), the Government of Canada announced its intention to enact, as quickly as possible, regulatory and policy changes that will result in a simpler, clearer and more modern regulatory system — one that will also support the development of innovative approaches and products. One of the regulatory amendments proposed in the FES was to allow the expanded use of PEDs on board aircraft, reducing regulatory burden on Canadian air operators and removing the competitive disadvantage experienced relative to other foreign air operators.

Objective

The objective of these amendments is to codify long-standing ministerial exemptions for commercial air operations by amending the CARs to be more outcome-based and to better align with international aviation authorities, such as the United States Federal Aviation Administration, the Civil Aviation Safety Authority of Australia, and the United Kingdom’s Civil Aviation Authority. There remains a need to regulate air operators on the expanded use of PEDs because of our international obligations with other states and as part of Transport Canada’s mandate respecting safety in this area.

This proposal addresses an early action item identified in the FES to enact regulatory changes that improve and support the development of an innovative regulatory environment.

Description

The following is an overview of the amendments to the CARs.

Part I — General Provisions

The amendments include a definition of a portable electronic device or PED that alleviates having to repeat “transmitting PEDs and non-transmitting PEDs” throughout the CARs and aligns with definitions used by Canada’s international partners.

Part VI — General Operating and Flight Rules

The amendments modify subsection 602.08(1), which applies to all operators of aircraft, to clarify the nature of the impairment that PEDs may cause.

Part VII — Commercial Air Services

The amendments add the following provision to Subpart 700:

The amendments codify the exemptions in a non-prescriptive manner and remove duplication of language. The PEDs provisions in subsections 703.38(3), 704.33(5) and 705.40(4) are repealed and are captured under the general section of Part VII. Previous provisions required air operators to establish procedures respecting PEDs that met the requirements in the CASS and in the air operator’s company operations manual. These requirements have been expanded to codify the exemptions in a non-prescriptive manner and are located under the general Subpart in Part VII.

The new provisions apply to air taxi operations (Subpart 703), commuter operations (Subpart 704), and airline operations (Subpart 705) relating to Canadian commercial air services that carry passengers in aircraft from 0–9 seats (Subpart 703), 10–19 seats (Subpart 704) and 20 and above (Subpart 705). The new requirements mandate air operators to keep records that document:

• a) the aircraft for which they will allow the use of PEDs (i.e. type, series and model of aircraft), and
• b) their validation that the use of PEDs will not impair the aircraft’s system or equipment during all phases of flight including critical phases.

Air operators must keep the most recent records on how they satisfy each of the above elements (a-b) and submit those records to the Minister upon request.

If interference from a PED is suspected, air operators must:

• a) immediately prohibit the use of the PED in question; and
• b) as soon as practicable, submit to the Minister a report of the PED’s interference with the performance of the aircraft’s systems or equipment.

These provisions are also designated by having monetary administrative penalties assigned to them. If non-compliance is found, Transport Canada could issue administrative monetary penalties against the air operator.

Regulatory development

Consultation

The amendments were not prepublished as they are codifying ministerial exemptions that have existed since 2007 by amending the CARs and are permissive, meaning the air operator is required to follow them only if they wish to allow the use of PEDs, which is a choice.

Consultations with the National Airlines Council of Canada in the form of teleconferences, face-to-face meetings and the submission of comments took place between February and June 2019 in which they supported the outcome-based regulatory amendments. Stakeholders recognize that agile regulations will provide them with the support to manage the continuing advancements in technology as it relates to PEDs.

Members of the Canadian Aviation Regulation Advisory Council (CARAC) were consulted on the regulatory amendments, as presented in these amendments, via a Notice of Proposed Amendment in May 2019 with no objections received. CARAC is a joint undertaking of government and the aviation community, with participation from a large number of organizations outside Transport Canada representing the overall viewpoint of the aviation community. These include management and labour organizations, representing operators and manufacturers, and professional associations. CARAC has been part of the Civil Aviation rule-making process since 1993.

Instrument choice

Option 1: Status Quo — keep restrictive regulations and standards, and exemption process

The CARs and CASS were too restrictive, lacked flexibility, and consequently have resulted in over 55 ministerial exemptions to the CARs since 2007 related to the use of PEDs. This option was not supported by air operators as there was a cost associated with requesting exemptions and a review and approval process required by the Minister of Transport.

Moreover, internal Transport Canada resources committed to issuing exemptions related to PEDs could be dedicated to other aviation safety regulatory work.

Option 2: No regulations, repeal all regulations and standards — no government oversight

Having no regulations does not support Canada’s commitments to harmonize with our United States, United Kingdom, and Australian counterparts and does not support Transport Canada’s mandate for promoting a safe transportation system. This option was not supported by Transport Canada and not supported by air operators. Air operators with international flights must demonstrate compliance with each foreign state’s regulatory requirements respecting PEDs when operating in their airspace.

Option 3: Outcome-based Regulations — preferred option

The amendments codify existing ministerial exemptions in a manner that is non-prescriptive, permissive and supports an outcome-based approach to regulating. As a result, the amendments bring agility in the CARs to support PED technology going forward and will provide economic equality to Canadian air operators. In addition, they align with practices used by the United States Federal Aviation Administration, the Civil Aviation Safety Authority of Australia, and the United Kingdom’s Civil Aviation Authority, and contribute to streamlining the international travel experience. Currently, the regulations in the aforementioned countries are outcome-based, permitting air operators to determine whether to allow the use of PEDs on board their aircraft with additional information on how to meet the requirements found in guidance material or advisory circulars. Transport Canada has a similar outcome-based approach to regulating and oversight with these amendments by allowing air operators to decide if they want to allow the expanded use of PEDs on board their aircraft, provided that certain conditions are met. Guidance on how to meet these conditions is set out in advisory circulars. Minor, consequential amendments to the CASS align with these regulatory amendments.

Regulatory analysis

The amendments give Canadian air operators the option to allow the use of PEDs on board their aircraft, provided that they keep records of the most recent required documentation. The regulatory analysis evaluates and monetizes the incremental changes using a 7% discount rate and 2018 constant dollars. The impacts of the amendments were estimated over a 10-year period (2019–2028).

Costs and benefits

Canadian air operators no longer have to apply for an exemption to allow the use of PEDs, resulting in cost savings from applications and renewals requests. There will also be cost savings for the government, as Transport Canada will no longer need to process exemption applications. The amendments will result in a present value total cost savings of $227,535 in the 10-year analytical period. The estimated cost savings for the air operator industry will be $71,521, while the government cost savings will be $156,014.

In addition to cost savings, the amendments align with other countries’ requirements, removing obstacles to competitiveness that are currently in place due to the limitations on the use of PEDs. Air operators will now be able to consistently allow passengers to use their PEDs on board Canadian-operated aircraft, providing enhanced customer satisfaction.

Baseline and regulatory scenarios

There remains a need to regulate air operators on the expanded use of PEDs because of our international obligations with foreign states and as part of Transport Canada’s mandate respecting safety. Because of the over-prescriptiveness of the former CARs and CASS, the industry relied heavily on ministerial exemptions.

Prior to the amendments, Canadian air operators who sought exemptions to allow the use of PEDs, were required to submit an application to Transport Canada. The package needed to demonstrate that the exemption was in the public interest, and was not likely to affect aviation safety or security. As part of the application process, air operators needed to provide documentation that showed the level of risk that PEDs could pose to potentially exempted aircraft and their passengers, and what mitigation measures have been taken and will be used to avoid any safety issues created by virtue of the exemption. The documentation needed to be submitted to Transport Canada for review, together with a $475 application fee per exemption request.

Once the exemption application was sent to Transport Canada, an inspector was tasked with the exemption request to ensure that submitted documents clearly explained the requirements needed to obtain an exemption. In cases where more information was needed to proceed with the application, Transport Canada communicated further with the air operator to clarify any issues with the application request and to ensure that the application satisfied all the requirements. Once issued, an exemption was valid for five years. Canadian air operators needed to submit a new application to Transport Canada for renewal if they wished to continue to allow PEDs on board the aircraft at hand, or to submit an application to modify an existing exemption. ^{footnote 3}

As a result of these amendments, Canadian air operators no longer need to apply for an exemption. This approach allows air operators to decide if they want to allow the expanded use of PEDs on board their aircraft provided certain conditions are met. Air operators are required to document the procedures used to confirm that the use of PEDs will not interfere with aviation safety. Advisory material provides guidance for air operators on how to meet these conditions. This regulatory analysis does not assess compliance with advisory material because it is not mandatory.

Table 1 presents baseline and regulatory requirements, as well as incremental changes due to the amendments.

Table 1 — Baseline versus regulatory scenario

Requirements	Baseline Scenario	Regulatory Scenario	Changes due to Amendments
Industry
Exemption application	Required for all exemption types: new, modification, and renewal.	No application needed.	Avoided application fees Avoided administrative costs
Safety procedures	Conduct procedures to measure risk level and possible interference.	Conduct procedures to measure risk level and possible interference.	No change.
Government
Exemption application process	Review and assess application and safety procedures.	No processing of applications.	Reduced application fee revenue Avoided application processing costs

Industry cost savings

Under the amendments, Canadian air operators no longer have to apply for an exemption to allow the use of PEDs, resulting in cost savings from reduced application costs and renewal requests. The present value total cost savings for air operators is estimated to be $71,521 over the 10-year analytical period.

Expected number of applications

Air operators that wanted to allow the use of PEDs in any of their aircraft had to submit an exemption application to Transport Canada. Although risk and interference assessments had to be conducted for each aircraft model separately, air operators can submit applications for more than one aircraft per exemption. Prior to the implementation of the regulatory scenario, a total of 29 exemptions had been issued between 2009 and 2018. These exemptions included seven different air operators and a total of 20 aircraft models. Out of the 29 exemptions, 19 included new exemptions, 5 involved renewals only, and 5 were renewals that included modifications of previously issued exemptions. ^{footnote 4}

As the use of PEDs on board aircraft around the world is increasing, it was expected that over the next 10 years under a continued baseline scenario, air operators would have continued to apply for exemptions and renew them. ^{footnote 5} In the baseline scenario, it was expected that air operators would submit 49 exemption applications in the next 10 years, and 11 of them would have been new exemptions.

In the baseline scenario, the number of new exemption applications would have been limited to aircraft models that did not have an exemption as of 2019 and could have potentially applied for exemptions. All of the new and current exemptions were expected to be renewed five years after they were last issued, resulting in 36 anticipated renewals. There would have been potential for two modifications of current exemptions, by adding more services or extending the flight phases for which PEDs are allowed.

To estimate the number of new exemption applications, the 2018 fleet of Canadian commercial aircraft was examined. For conservative measures, it is assumed that air carriers that have never applied for an exemption in the past, would apply for an exemption exclusively for aircraft for which other air operators have obtained exemptions previously. Moreover, for air operators that currently hold exemptions, it is assumed that in the next five years these air operators would apply for all of their aircraft that do not hold exemptions.

The numbers of renewals and modifications were based on the fleet of Canadian commercial aircraft that currently hold exemptions. From 2009 to 2018, all exemptions were renewed before their expiration. For this reason it is assumed that all exemptions, both new and old would be renewed in the 10-year analytical period. ^{footnote 6} To account for uncertainty on the number of expected applications in the next 10 years, lower and higher estimates were examined in the sensitivity analysis section below.

Avoided application fees

Under the amendments, air operators are no longer required to submit an exemption application to Transport Canada. Cost reduction to air operators will result from the elimination of the application process, thereby avoiding application fees ($475 per application). As mentioned previously under a continued baseline scenario, it was expected that air operators would have submitted a total of 49 applications in the 10-year analytical period, resulting in a present value total cost savings of $16,767 for Canadian air operators.

Avoided administrative cost

The amendments discontinue the exemption process, avoiding administrative costs related to the preparation and submission of an exemption application by air operators. Table 3 represents the average time and salary for employees involved in preparing and submitting a new exemption application to Transport Canada. The average time spent by employees was then multiplied by the average hourly salary to calculate the administrative cost of submitting an application. Under the baseline scenario, it was estimated that the submission of a renewal or a modification of a current exemption would take less time to prepare, as air operators have provided most of the necessary information in the initial exemption submission.^{footnote 7}

Table 3 — Cost savings: Time spent on the preparation and submission of a new exemption — in 2018 dollars

Activity	Employee/Position	Hours	Wage per hour table 3 note *
Preparing and submitting application	Administrative staff	17.5	$27.04
	Management position	17.5	$52.03
	Subject-matter expert	17.5	$37.25
Table 3 note(s) Table 3 note * Wage per hour includes a 25% overhead adjustment. Return to table 3 note * referrer

Source: Statistics Canada. Table 14-10-0307-01 Employee wages by occupation, annual.

Based on the above table, the amendments will result in an administrative cost savings to the air operator industry of $54,755.

Government cost savings

The present value total cost savings to government are estimated to be $156,014, including both administrative cost savings and reduced government revenue over the 10-year analytical timeframe.

Avoided application processing

The amendments free-up Transport Canada resources that would have been otherwise dedicated to process exemption applications under the baseline scenario. Without the amendments, it is expected that they would receive 49 applications in the next 10 years, and on average, processing a new exemption imposes a cost of $7,060. This cost is lower for modification and renewal of existing exemptions ($3,530 and $1,765, respectively). The present value total cost of processing an exemption application is based on exemption type and number of aircraft involved. Based on the expected number of applications discussed above, ^{footnote 8} the total government and industry cost savings due to avoided application processing will be $172,781.

Since the amendments discontinue the exemption process, Transport Canada will no longer receive application fees, resulting in $16,767 cost savings to industry. As a result, the net cost savings to the government will be $156,014.

Other benefits

Under the baseline scenario, the use of PEDs on board Canadian aircraft is limited to those aircraft models with an exemption. The amendments allow the use of PEDs on board all Canadian-operated aircraft (provided that air operators have validated that their use is safe and hold the most recent records showing that PEDs do not interfere with aircraft systems). This may result in enhanced customer satisfaction. Air operators will be able to allow passengers to consistently use their PEDs on board Canadian-operated aircraft. In addition, the amendments will increase Canadian air operators’ competitiveness, as they align with other countries’ requirements, removing obstacles to competitiveness that are currently in place due to the limitations on the use of PEDs on board Canadian aircraft.

Cost-benefit statement

As mentioned in the discussion above, the benefits consist of cost savings to both industry and government. As there are no costs related to the amendments, the present value cost-reduction will be $227,535. During the first year, the present value of the cost savings will be $32,505, including both industry and government. The present value annualized net cost savings will $32,396.

Table 4 — Cost-benefit statement (present value, discounted at 7%, 2018 dollars)

	Base Year 2019	Final Year 2028	Total	Annualized Total
MONETIZED IMPACTS
Industry cost savings
Avoided application fees	$1,912	$2,722	$16,767	$2,387
Avoided administrative cost	$6,385	$7,404	$54,755	$7,796
Total industry cost savings	$8,296	$10,126	$71,521	$10,183
Government cost savings
Total government cost savings	$24,209	$14,366	$156,014	$22,213
Total cost savings	$32,505	$24,492	$227,535	$32,396
QUALITATIVE IMPACTS
Enhanced customer satisfaction. Increased Canadian air operators’ competiveness relative to their foreign counterparts.

Note: Totals might not add up due to rounding.

Sensitivity analysis

A sensitivity analysis was conducted varying the number of expected applications. The number of expected applications is based on the 2018 Canadian air fleet. The central scenario represents a forecast of applications where new exemptions are possible for air operators that had already applied for exemptions previously. For air operators that had not previously applied for exemptions, it was expected that they would have applied for an exemption exclusively for aircraft models for which other Canadian air operators have obtained exemptions in the past. The total number of applications in the central scenario is 49.

The other two scenarios represent lower and higher numbers of possible applications. In the lower scenario, the minimum number of applications is expected. Estimated new exemptions were limited to air operators that had applied for exemptions before, and renewal of current and future exemptions were taken into account, and assumed that no modifications would have been requested. The total number of applications in the lowest scenario is 36.

Lastly, the high scenario assumes the maximum number of estimated applications. Similar to the central scenario, in the high scenario it was assumed that all operators that had applied before would have applied for aircraft models that did not have exemptions yet, and air operators that had not applied for exemptions would have applied for most of their aircraft models, excluding small jets and cargo aircraft. And for exemptions that had potential for modifications, air operators would have submitted applications to do so. The total number of applications in the highest scenario is 53. Table 5 represents the cost reduction for all three scenarios.

Table 5 — Sensitivity analysis: Scenario analysis

Cost savings	Lowest Scenario	Central Scenario	Highest Scenario
Industry cost savings	$80,244	$71,521	$41,777
Government cost savings	$78,048	$156,014	$183,563
Total cost savings	$158,292	$227,535	$225,340

Note: Totals might not add up due to rounding.

“One-for-One” Rule

While the amendments contain reporting and record-keeping requirements, these do not qualify as administrative burden requirements under the “One-for-One” Rule.

The amendments mandate documenting and keeping of records of any possible PEDs interference with aircraft systems. Air operators are required to submit such documentation to the Minister upon request. These activities are already carried out by affected air operators as a matter of business practice, but the amendments formalize them as requirements. As such, the amendments are not imposing any incremental administrative burden on the air operator industry.

The elimination of the exemption process results in administrative cost savings for the air operator industry, since they are no longer required to complete and submit applications. This is an administrative process and not a regulatory one. Therefore, it is considered a decrease in cost for the affected industry, but it cannot be considered an OUT under the “One-for-One” Rule.

Small business lens

The small business lens does not apply to the amendments, as no incremental costs will be imposed on air operators, including small operators. In fact, Canadian air operators no longer have to apply for an exemption to allow the use of PEDs, resulting in cost savings from reduced application costs and renewal requests.

Regulatory cooperation and alignment

The regulatory amendments harmonize Canadian requirements with international practices used by the United States Federal Aviation Administration, the Civil Aviation Safety Authority of Australia, and the United Kingdom’s Civil Aviation Authority who all allow the use of all types of PEDs on board aircraft.

Strategic environmental assessment

In accordance with The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.

Gender-based analysis plus

No gender-based analysis plus (GBA+) impacts have been identified for this proposal.

Implementation, compliance and enforcement, and service standards

Implementation

These amendments come into force upon their registration and, as a result, all existing exemptions that were in place prior to the amendments are repealed. Up-to-date advisory circulars will be made available by Transport Canada to assist air operators to comply with amendments.

Transport Canada will enforce these amendments by

• imposing monetary penalties under sections 7.6 to 8.2 of the Aeronautics Act, which carry a maximum fine of $5,000 for individuals and $25,000 for corporations; or
• suspending or cancelling a Canadian aviation document.

Transport Canada will conduct its implementation, compliance promotion and enforcement activities with existing resources, within the existing departmental reference level.

Contact

Chief
Regulations
Aviation Safety Regulatory Review (AARK)
Civil Aviation
Safety and Security Group
Transport Canada
Place de Ville, Tower C
330 Sparks Street
Ottawa, Ontario
K1A 0N5
Telephone: 613‑993‑7284 or 1‑800‑305‑2059
Fax: 613‑990‑1198
Email: carrac@tc.gc.ca
Website: www.tc.gc.ca