Canada Gazette, Part I, Volume 157, Number 12: Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment

March 25, 2023

Statutory authority
Transportation of Dangerous Goods Act, 1992

Sponsoring department
Department of Transport

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Order.)

Executive summary

Issues: Presently, there are no fees charged to process applications and certify persons who are registered with Transport Canada (TC) through the Transportation of Dangerous Goods (TDG) Means of Containment (MOC) Facilities Registration Program. Therefore, there is a strain on TC resources to maintain current service levels, and Canadian taxpayers are subsidizing services provided through the MOC Facilities Registration Program. A cost-recovery regime is needed to ensure that the beneficiaries of TC’s services pay a portion of the costs to provide those services.

Description: The proposed ministerial fees order would introduce fees that would be applicable to operators of container facilities who design, manufacture, requalify, or repair MOCs as well as to design engineers who design standardized MOCs. Fees would also be applicable to service providers to review designs of MOCs, inspect MOCs and provide training to companies that conduct MOC activities. Under the ministerial fees order, fees would be required for

  • (1) Initial registrations: for new applicants who want to register with TC and obtain a certificate of registration; and
  • (2) Certificate renewals: for applicants with a current certification who want to maintain their certificate of registration with TC. Most certificates must be renewed every five years.

Rationale: Persons registered with TDG’s MOC Facilities Registration Program benefit from this service without sharing the costs to provide this service. A MOC certificate provides registrants the exclusive benefit of market access, which is not available to unregistered persons. Subsection 29(1) of the Transportation of Dangerous Goods Act, 1992 (TDGA) gives the Minister the authority to make orders fixing any fees or charges to be paid for services that TC offers. Implementing the proposed ministerial fees order would require the beneficiaries of MOC services to pay a portion of the costs of these services. The proposed Order would also promote a better balance between the financial burden borne by service recipients and by Canadians generally. A modern fee structure that is adjusted for inflation in accordance with the Service Fees Act will allow TC to address future growth in demand, improve how it delivers its TDG MOC registration services through an innovative registry system, and meet standardized and transparent timelines for service delivery.

The total cost to stakeholders who would need to pay service fees was estimated to be $3.01 million between 2024 and 2033 (present value in 2021 Canadian dollars, discounted to the base year of 2024 at a 7% discount rate).

The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses. The small business lens applies, as there are impacts on small businesses associated with the ministerial fees order. It was estimated that small businesses would assume a total cost of approximately $2.13 million (present value in 2021 Canadian dollars, discounted to the base year of 2024 at a 7% discount rate) between 2024 and 2033.

Issues

TC’s MOC Facilities Registration Program is administered through the TDG Directorate and currently costs Canadians approximately $4.8 million annually. Although the TDGA gives the Minister the authority to fix fees, thereby recovering costs, there is no ministerial fees order in place establishing fees to process MOC applications and provide certificates. Implementing a ministerial fees order for MOC registrants would reduce the burden on the Government and the Canadian public, while ensuring that the beneficiaries of services pay an appropriate share for those services.

Background

In Canada, the transportation of dangerous goods is regulated under subsection 5.1, and sections 8 and 9 of the TDGA and Part 5 of the Transportation of Dangerous Goods Regulations (TDGR). There are also multiple technical safety standards incorporated by reference into the TDGR, prescribing detailed requirements for the safe transport of dangerous goods. As prescribed by the TDGA and the TDGR, dangerous goods must be transported in an appropriate MOC. A MOC is the container or packaging used to hold dangerous goods. Along with the TDGA and the TDGR, the safety standards indicate what containers are permitted for a particular dangerous good and prescribe the requirements to design, manufacture, requalify or repair MOCs. For example, certain dangerous goods are held in “small MOCs” with a capacity of less than or equal to 450 L, such as bags, boxes, or cylinders. Others are held in “large MOCs,” such as highway tanksfootnote 1 (e.g. tank trailers and tanker trucks), tank cars,footnote 2 tubes and intermediate bulk containers (IBCs)footnote 3 [IBCs that have a capacity greater than 450 L but less than or equal to 3 000 L and in some cases, up to 5 000 L]. Although not all MOCs are standardized (meaning a MOC to which a safety standard applies under the TDGR), all MOCs must be designed, constructed, filled, closed, secured, and maintained so that under normal conditions of transport, there will be no release of dangerous goods that could endanger public safety and the environment.

MOCs used in Canada are produced both domestically and internationally. Canadian regulations governing MOCs are mostly harmonized with those of the United Nations (UN), allowing the use of UN standardized means of containment (UN packaging, UN portable tanks, etc.) in Canada. Currently, there are reciprocal agreements in place that allow MOCs manufactured in the United States to be used in Canada. In addition, some companies abroad (in the United States or other countries) may choose to be registered with TC through the TDG MOC Facilities Registration Program. This is mainly to facilitate the use of their containers in Canada, as users are aware that companies registered with TC would have met the requirements in the TDGR and its safety standards.

TC reviews applications from persons who wish to be registered to design, manufacture, requalify or repair MOCs in a facility, as well as service providers who review designs of MOCs (e.g. design engineers), inspect MOCs and provide training to MOC companies. An application could include documents regarding the details of the company (e.g. the name and address), the type of MOCs, the types of services provided, and the designs of MOCs. Following the review of an application, TC may need to inspect the applicant’s container facilities to ensure they meet the requirements set out by the TDGR and its safety standards. TC currently recovers the cost for travel and accommodations for international inspections related to the issuance or renewal of a certificate. Certificates of registration are then granted to those persons who meet the requirements. These certificates must be renewed every five years.

Section 29 of the TDGA gives the Minister the authority to fix fees for MOC registrations; however, to date this authority has not been exercised. Therefore, there is currently no fee for the processing of applications and issuing of certificates related to MOCs. The proposal to recover fees for MOC registrations is part of TC’s broader plan to modernize its regulatory regime, services, and fees.

Objective

The purpose of the proposed ministerial fees order is to establish fees applicable to operators of container facilities who design, manufacture, requalify, or repair MOCs; to design engineers who design standardized MOCs; and to service providers who review designs of MOCs, inspect MOCs or provide training to employees who manufacture MOCs. By implementing a modern fee regime that requires the beneficiaries of MOC registration services to pay a portion of the costs for these services, TC is promoting better balance between the financial burden borne by service recipients and by Canadians. The proposed fees, which would be adjusted for inflation in accordance with the Service Fees Act, would allow TC to address future growth in demand and support an efficient TDG program.

Description

Under the proposed ministerial fees order, any operator of a container facility, design engineer or service provider required by the TDGR and its standards to be registered to conduct MOC-related activities would be required to pay a fee to initially register with TC as well as to renew their certificate of registration.

Fees for registration

The proposed Order would indicate that the fees would be payable upon application for the issuance or renewal of a certificate of registration. Fees would be payable even if a certificate of registration is not issued.

Service types

Registration: An initial registration application is an application by a person to register a container facility to design, manufacture, requalify or repair MOCs, or for a service provider to review designs of MOCs, inspect MOCs or provide training to employees who manufacture MOCs, pursuant to the safety standards prescribed in the TDGR. The successful registrant would receive a certificate that would allow them to conduct MOC activities.

Renewal: A renewal registration application is an application by an existing client to renew a certificate that allows their container facility to remain registered and design, manufacture, requalify or repair MOCs, or in the case of a service provider, continue to review designs of MOCs, inspect MOCs or provide training to employees who manufacture a MOC, pursuant to the safety standards prescribed in the TDGR. The renewal interval for MOC registration certificates is every five years.

Table 1: Fees payable for registration
Applicant

Initial registration

Fee

Renewal of registration

Fee

Operator of a container facility $1,700 $1,700
Service provider $1,700 $1,700
Design engineer $808 $808

Phasing in of fees

The proposed fees for processing applications for the initial registration and certificate renewal would be phased in gradually over a period of five years, as noted below and in Table 2.

Table 2: Phase-in schedule for proposed fees
Applicant

Initial or renewal registration fee

Year 1

(60% of final fee)

Initial or renewal registration fee

Year 2

(70% of final fee)

Initial or renewal registration fee

Year 3

(80% of final fee)

Initial or renewal registration fee

Year 4

(90% of final fee)

Initial or renewal registration fee

Year 5

(100% of final fee)

Operator of a container facility $1,020 $1,190 $1,360 $1,530 $1,700
Service provider $1,020 $1,190 $1,360 $1,530 $1,700
Design engineer $485 $565 $646 $727 $808

Fees for foreign facility inspections

TC currently recovers travel-related costs for foreign container facility inspections. Recovered costs include costs for transportation, lodging, meals and incidental expenses in accordance with the rates set out in the National Joint Council Travel Directive. These expenses would continue to be recovered under the proposed order.

New application process

At present, applications for MOC certificates are processed by TC without the payment of a fee. TC would continue to process applications once the proposed ministerial fees order comes into force, but fees for services could be paid using the existing TC online payment functionality. In addition, a new web-based application system is under development and would be rolled out prior to the coming into force of the proposed order. The web-based system would allow persons to submit all documents pertaining to their MOC registration application and pay the associated fee. Applicants would also receive status updates on their file through the system. Once TC has validated that an application is complete, i.e. that it meets requirements for registration and demonstrates compliance with the safety standards, the applicant would receive a certificate of registration or be informed that an inspection would be required prior to the issuance of a certificate.

Regulatory development

Consultation

The MOC stakeholder community is made up of persons who design, manufacture, repair, or requalify MOCs used or intended for use in transportingfootnote 4 dangerous goods, as well as third-party inspectors, trainers and design reviewers, transportation agencies and industry users. Most stakeholders are domestic, with approximately 1 670 domestic container facilities and associated entities currently registered with TC, compared to 215 internationally. Another key group of stakeholders is the TDG General Policy Advisory Council (GPAC). The TDG GPAC is composed of over 40 different industry associations. This group meets twice annually to discuss dangerous goods issues affecting all types of stakeholders across the TDG industry.

Preliminary engagement (2018)

In early October 2018, TC sent a discussion paper to over 1 800 stakeholders, which resulted in a 30-day consultation that closed on November 7, 2018. The purpose of this consultation was to seek feedback on the proposed fee design, fees and service standards. TC received 16 responses from stakeholders. On October 31, 2018, TC hosted a webinar with interested stakeholders to discuss the initiative and present the themes of the discussion document. The webinar was attended by 103 stakeholders, 38 of whom provided feedback. TC also presented an overview of its MOC fee modernization initiative at the GPAC meetings in May and November 2018.

Overall, the rationale for introducing fees for the MOC Facilities Registration Program and the need for fee modernization was understood and accepted by most stakeholders. It was recognized that there is a reasonable rationale for regulatory agencies to pursue cost recovery strategies when service delivery provides benefits to regulated entities. However, there were concerns raised during the consultation period as outlined below.

Costs
Competitiveness of the industry
Clarify service structure
Grouping or discounting fees
Rural communities

TC noted the impact the proposed fees could have on the industry and how charging for certain types of administrative changes to a registration could result in reduced compliance with the TDGR if companies began under-reporting their involvement in the MOC industry. Under-reporting would negatively impact TDG’s safety and oversight.

TC took all the feedback into consideration and developed a revised cost recovery approach that aims to respond to the main themes heard during the initial consultation:

Follow-up stakeholder consultation (2021)

Given that the proposal had undergone significant revisions, stakeholders were invited to provide their feedback at a GPAC meeting held in May 2021, and at webinars held in June 2021. There were 259 stakeholders who attended the webinars in June.

The key concerns raised by stakeholders and TC’s response are as follows:

Costs
Clarity on types of services included
Timeline
Conditions for reimbursing fees

Modern treaty obligations and Indigenous engagement and consultation

In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an analysis was undertaken to determine whether the proposed ministerial fees order is likely to give rise to modern treaty obligations. This assessment examined the geographic scope and subject matter of the proposed order in relation to modern treaties in effect, and no modern treaty obligations were identified.

Instrument choice

Currently, the financial burden of providing the MOC registration services falls on all Canadians, while registered persons benefit exclusively from the MOC Facilities Registration Program. Therefore, there is a need to recover a portion of these costs from persons who conduct MOC activities.

Section 29 of the TDGA provides that the Minister may, by order, establish fees for certain services TC provides. A ministerial fees order was therefore proposed to recover costs for the MOC Facilities Registration Program. This instrument would address the issues outlined above and better balance the financial burden of the service delivery costs between service recipients and taxpayers.

Maintaining the status quo would not respond to the issues raised above and would continue to support an outdated system with disproportionate service benefits.

Regulatory analysis

Operators of container facilities, design engineers and service providers who wish to register with TC to conduct MOC-related activities would be required to pay a portion of TC’s service cost of processing applications for initial and renewal registrations. The analysis below examines the costs and benefits attributed to Canadians through this proposal. Due to the cost recovery nature of the proposed ministerial fees order, the costs to domestic stakeholders represent a rebalance of the cost burden from Canadians (represented by TC) to domestic stakeholders; whereas the costs to foreign stakeholders would represent a net gain in the cost recovered by TC (since these costs would not be borne by Canadians). Therefore, costs to domestic stakeholders would have a neutral impact on Canadian society, while costs to foreign stakeholders are considered a benefit to Canadians.

The total cost to Canadian users of MOC registration services would be $2.66 million (present value in 2021 Canadian dollars, discounted to 2024 at a 7% rate) between 2024 and 2033. During the same analytical period, the total benefit (i.e. recovered cost by TC) would be $3.01 million, $2.66 million of which would be service revenue paid by domestic MOC registration service users and $0.35 million by foreign users. As a result, the net benefit for this proposal would be $0.35 million (present value in 2021 Canadian dollars, discounted to 2024 at a 7% rate) in total between 2024 and 2033.

The fees charged to industry would be used to recover about 17% of the costs incurred by TC to provide MOC registration services, which are currently funded entirely by Canadian taxpayers. Therefore, the ministerial fees order would rebalance a portion of the costs from Canadian taxpayers to the TC clients who benefit from the services.

Analytical framework

The costs and benefits for the proposed ministerial fees order have been assessed in accordance with the Treasury Board of Canada Secretariat (TBS) Policy on Cost-Benefit Analysis. Where possible, impacts are quantified and monetized, with only the direct costs and benefits for stakeholders being considered in the cost-benefit analysis.

Benefits and costs associated with the proposed order are assessed based on comparing the baseline against the regulatory scenario. The baseline scenario depicts what is likely to happen in the future if the Government of Canada does not implement the proposed order. The regulatory scenario provides information on the intended outcomes as a result of the proposed order.

The analysis estimated the impact of the proposed order over a 10-year period from 2024 to 2033, with the year 2024 being when the proposed order is expected to be coming into force. Unless otherwise stated, all costs are expressed in present value in 2021 Canadian dollars, discounted to the year of 2024 at a 7% discount rate.

It is also important to note that proposed fees presented in Table 1 above are in 2024 Canadian dollars. For the purpose of this analysis, they have been adjusted to 2021 Canadian dollars using the Conference Board of Canada’s Consumer Price Index (CPI) Forecast.

Affected stakeholders

The proposed ministerial fees order would apply to companies involved in the design, manufacture, and repair or requalification of dangerous goods MOC. Three categories of MOC registrants would be impacted by the proposed order: those registering container facilities, service providers (inspecting or providing training) and design engineers. Table 3 shows a breakdown of active registrations for each stakeholder category. A total of 215 certificates are held by foreign companies while 1 670 are held by Canadian companies. Large companies with multiple facilities would pay for a certificate of registration for each location. According to TC subject matter experts, and regarding the size of affected domestic companies, it was estimated that 80% would be small businesses.footnote 5

Table 3: Count of active certificates of registration by stakeholder category and registration type
Source: Transport Canada
Certificates of registration type Domestic certificates Foreign certificates
Operator of a container facility 1 572 162
Service provider 9 33
Design engineer 89 20
Total active certificates 1 670 215
Percentage 89% 11%

It is expected that the introduction of fees would decrease the number of registrations during the analytical time frame, as some small companies may decide to stop their activities (see details below). This may be caused by those businesses that have low volumes of MOCs, particularly in cases where MOCs are not their main service or revenue stream. For example, a manufacturer with a few clients requiring MOCs may decide to no longer provide this service once fees are required, as they may find that the cost of providing this service now outweighs the revenue generated. They may also choose to pay the fee only when they have a significant order. Moreover, containers produced in the United States are accepted in Canada through reciprocal agreements. This harmonization with the United States could also lead to a decrease in the number of registrations in some areas, as some foreign facilities may discontinue their registration if they no longer wish to register with TC to avoid paying these fees.

Baseline and regulatory scenarios

Under the baseline scenario, certificates of registration are granted to companies that submit application requests that meet the requirements set out by the TDGA, the TDGR and the relevant technical safety standards. Registration services are provided by TC free of charge, and certificates of registration are renewed every five years. For inspections at a foreign registrant’s facility, TC only recovers the travel, meals, accommodation, and incidental costs incurred by TC officials to perform the inspection. Based on historical data, it is expected that the annual number of active certificates would decline over the analytical timeframe.

Under the regulatory scenario, TC would introduce fees for the TDG MOC registration service users. Initial and renewal fees would be charged to companies registering for container facilities, to service providers, and to design engineers. TC would continue to recover travel and accommodation costs incurred by TC officials for a foreign registrant’s facility inspection. Table 4 below shows the proposed fees adjusted to 2021 Canadian dollars of the proposed order. In addition, the proposed fees would further reduce the annual number of active certificates, which was estimated to be 5% more than what is projected under the baseline scenario.

Table 4: Proposed fees
Source: Transport Canada
Applicant Initial and renewal fees table b1 note *
Baseline Scenario Regulatory scenario
Coming into force date to March 2025 April 2025 to March 2026 April 2026 to March 2027 April 2027 to March 2028 April 2028 to March 2029 April 2029 and onward
Container facilities $0 $899 $1,048 $1,198 $1,348 $1,498 $1,498
Service providers $0 $899 $1,048 $1,198 $1,348 $1,498 $1,498
Design engineers $0 $427 $498 $569 $640 $711 $711

Table b1 note(s)

Table b1 note *

The proposed fees presented in Table 4 are adjusted to 2021 Canadian dollars, and therefore are slightly different from those in tables 1 and 2.

Return to table b1 note * referrer

Costs and benefits

Costs

Costs to industry are derived by multiplying proposed fees and the number of expected active certificates over the 10 years of analysis.

As presented in Table 3, there are 1 885 active certificates issued prior to 2024. For the purpose of this analysis, it is assumed that no new registration and renewal would occur in 2023, and all existing active certificates would be renewed in 2029. In addition, it is assumed that TC would register an average of 143 new applications every year during the analytical time frame (i.e. 2024 to 2033), which would be renewed every five years.

Costs to industry are presented below by type of registration certificates and by type of stakeholders.

Costs by type of registration certificates

As presented in Table 5, about 95% of the total cost would apply to container facilities registration ($2.84 million) since the majority of certificates of registration are for container facilities. The rest of the total cost would apply to service providers registration (2% of the total cost, $0.07 million) and to design engineer registration (3% of the total cost, $0.10 million).

Table 5: Costs by certificate of registration type (present value in millions of dollars)
Type of registration certificates Total cost Percentage
Container facilities 2.84 95%
Service providers 0.07 2%
Design engineer 0.10 3%
Total 3.01 100%
Costs by type of stakeholders

The costs associated with the proposed Order would be incurred by Canadian and foreign companies involved in the designing, manufacturing, repairing, and requalifying of dangerous goods MOC. Domestic stakeholders would incur most of the costs, $2.66 million in total (89% of the total cost), while foreign stakeholders would incur a total cost of $0.35 million (11% of the total cost).

Table 6: Costs for domestic and foreign stakeholders, by type of registration certificates (present value in millions of dollars)
Stakeholders Container facilities Service providers Design engineers Total
Domestic 2.54 0.03 0.09 2.66
Foreign 0.30 0.04 0.01 0.35
Total 2.84 0.07 0.10 3.01
Cost to the Government

For the payment of the proposed fees, stakeholders will use an existing myTC online payment service, which would be adapted and linked to a new web page and platform for the application registration. For this purpose, a development team is working on integrating and adapting the various systems. TC is currently upgrading the payment service system with new features including the ones associated with fee payment. It is expected that the system upgrade and onboarding would be completed before the coming into force of the proposed Order. Therefore, costs related to the system are not monetized for this analysis, as they are outside of the analysis scope.

Benefits

As previously stated, the proposed Order would result in rebalancing the cost from Canadians to users of the MOC registration services. The total cost recovered by TC from industry would be $3.01 million, $2.66 million of which would be from service fees paid by domestic stakeholders and $0.35 million by foreign stakeholders.

Cost-benefit statement
Table 7: Monetized costs (present value in millions of dollars)
Impacted stakeholder Description of cost Base year (2024) 2025 2026 2027 2028 Annual average
(2029–2032)
Final year
(2033)
Total
(present value)
Annualized value
Domestic companies Fee charged by TC 0.10 0.10 0.10 0.10 0.10 0.51 0.12 2.66 0.38
Foreign companies Fee charged by TC 0.01 0.01 0.01 0.01 0.01 0.07 0.02 0.35 0.05
All stakeholders Total cost 0.11 0.11 0.11 0.11 0.11 0.58 0.14 3.01 0.43
Table 8: Monetized benefits (present value in millions of dollars)
Impacted stakeholder Description of benefits Base year (2024) 2025 2026 2027 2028 Annual average (2029–2032) Final year (2033) Total (present value) Annualized value
Government Government total cost recovery 0.01 0.01 0.01 0.01 0.01 0.07 0.02 0.35 0.05
Table 9: Summary of monetized costs and benefits (present value in millions of dollars)
Impacts Base year (2024) 2025 2026 2027 2028 Annual average (2029–2032) Final year (2033) Total (present value) Annualized value
Total costs 0.11 0.11 0.11 0.11 0.11 0.58 0.14 3.01 0.43
Total benefits 0.01 0.01 0.01 0.01 0.01 0.07 0.02 0.35 0.05
Net cost 0.10 0.10 0.10 0.10 0.10 0.51 0.12 2.66 0.38

Small business lens

Analysis under the small business lens concluded that the proposed ministerial fees order would impact small businesses. Based on TC subject matter experts, 80% of domestic affected stakeholders would be a small business. Thus, small businesses would bear a total cost estimated at $2.13 millionfootnote 6 between 2024 and 2033.

The new fees would apply equally to all companies regardless of size. Recognizing these impacts, TC incorporated the feedback received from stakeholders and has made several changes to the original proposed fees and its structure. These changes include removing fees for all administrative amendments and charging fees for initial registrations and renewal only and lowering the overall fees and grouping some fees together, particularly for standards that list registration requirements for multiple activities under the same clause (e.g. Canadian Standards Association [CSA] Standard B339, “Cylinders, spheres, and tubes for the transportation of dangerous goods”). These activities would now be registered under one unique registration.

Furthermore, to address small business concerns more generally, fees would be phased in gradually over a five-year period, as shown in Table 2. As this approach reduces the financial burden on affected stakeholders, both in terms of the total amount to be paid and the time required to pay the full amount, it thus mitigates the impact that the fees would have on the growth of the industry as it recovers from the challenges encountered following the COVID-19 pandemic. In addition, it would ensure that stakeholders whose registration comes due for renewal soon after the fees take effect are not unduly penalized.

Small business lens summary
Table 10: Compliance costs (present values)
Activity Annualized value Present value
TC service fees $0.30 million $2.13 million
Cost per impacted business $227 $1,592
Total compliance cost (all impacted small businesses) $0.30 million $2.13 million

One-for-one rule

The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses. The introduction of fees would not change the registration process which remains the same, apart from paying the fees online. The fee payment online would not increase the administrative burden on businesses.

Regulatory cooperation and alignment

The proposed ministerial fees order is not being introduced to comply with an international agreement or obligation, nor does it have any impacts related to a work plan or commitment under a formal regulatory cooperation forum. Currently, other international jurisdictions such as the United States and Australia do not charge fees for MOC registration as is being proposed in Canada. However, these countries charge fees for other TDG services such as registration for the transporting of certain dangerous goods in the United States. Also, in Australia, different states impose fees for various services including licensing drivers who transport dangerous goods and approving tank designs. Although the proposed Order would not align internationally with respect to registration fees, it would not impact other areas of alignment with respect to TDG practices internationally. Also, as was mentioned above, since the TDGR and corresponding safety standards governing MOCs in Canada are mostly aligned with those of the UN (UN standardized means of containment), UN packaging, UN large packaging, UN IBC, and UN portable tanks that have been manufactured and marked by other countries can also be used in Canada.

Given our shared border and the high volume of dangerous goods being transported between the United States and Canada, there are reciprocal agreements in place between both countries. These reciprocal agreements mean that a MOC manufactured to a U.S. standard will automatically be accepted in Canada and vice versa. Although the United States does not charge registration fees, they do charge fees for some MOC-related services. These fees are based on the type and size of the operations. The fees being proposed under the order would depend on the type of operation but not the size. Implementing the proposed Order in Canada would not cause any disruptions in the flow of dangerous goods between Canada and the United States.

Strategic environmental assessment

The proposed ministerial fees order would introduce new fees for an existing service in order to recover costs. The proposed order is not expected to result in important environmental aspects. 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

MOC registrants are expected to benefit directly from this initiative. Registrants would benefit from a service standard, improved submission tools for their applications, clarity and transparency in the application process and the ability to continue performing MOC-related activities throughout Canada. As with most of the transportation industry, it is estimated that at least 80% of these registrants are males and Caucasian.

Although introducing fees for MOC registrants is not expected to have any significant negative impacts that would create or exacerbate gender diversity inequalities, there are some potential negative economic impacts on some companies or individuals that register with the TDG MOC Facilities Registration Program, as well as the dangerous goods transportation industry. For example, in earlier consultations, some stakeholders mentioned they may not be able to absorb the costs to register with TC, which could result in a loss of some services. Such losses may impose additional expense to businesses that use MOCs, as this would decrease the availability of MOCs and MOC services. Particularly for those who operate in rural areas, having fewer companies could increase costs, as they would need to transport their MOC to larger centres for external inspections or requalification.

To reduce the economic impact on businesses, TC revised its original proposal by implementing the following:

Along with the above revisions, the proposal includes a new service standard on which the industry has been consulted. Contrary to how things are done currently, under the proposed ministerial fees order, transparency in the application process would increase, as MOC applicants would have clear expectations of how long it would take to review their application.

TC would continue applying a gender-based analysis plus (GBA+) and intersectionality lens in all future engagements with industry.

Implementation, compliance and enforcement, and service standards

Implementation

The proposed ministerial fees order would come into force six months after it is published in the Canada Gazette, Part II. TC is currently developing an online application where persons wishing to register with TDG MOC can submit any necessary documents relevant to their application and receive status updates on their submissions. Payment could be made through an existing myTC Account online method. TC anticipates that the application would launch prior to the coming-into-force date of the proposed order. During the transition to the new system, applicants would still be able to submit applications to TC through the traditional methods: by email, phone, or mail.

TC monitors this regulated body of stakeholders to note how many applicants are registered, how many businesses are inactive and how often businesses update their profiles. This system would be enhanced to ensure that it continues to meet the needs of stakeholders and is efficient. Stakeholders would be encouraged to provide their feedback and inform TC of any issues they may have with using the system.

Applications made prior to the coming-into-force date of the ministerial fees order would not be subject to the fees established in the order. Applications received after the six-month transitional period would be subject to the fees outlined in the order and would be payable before TC would begin processing the application for registration. To ease the financial burden on stakeholders, TC is implementing a phase-in approach for the proposed fees over a period of five years.

TC would develop guidance and explanatory materials to ensure that the new fees are applied consistently across Canada, and to ensure that stakeholders clearly understand how and when the fees would be applied. These materials would be available prior to the new fees coming into force. Some of the tools that TDG would use to raise awareness of the proposed order and fees are

Compliance and enforcement

Since registrants are expected to pay before their applications are processed, enforcement would not be necessary for payment. As mentioned above, inspections are conducted, if needed, to establish that the requirements for the issuance of the certificate have been met. In the case of such inspections abroad, foreign clients are currently required by contract to absorb the costs of transportation, accommodation, meals and incidental expenses for TC inspectors. These costs would continue to be payable under the proposed order.

With respect to payment of the fees being proposed under this order, any fees owing would constitute a debt due to His Majesty in right of Canada and may be recovered in any court of competent jurisdiction, in accordance with the relevant provisions of the Financial Administration Act.

Service standards

The Service Fees Act requires that government departments include four key concepts in their cost recovery initiatives: consumer price indexing, service standards, annual reporting, and a remission policy. In accordance with the Service Fees Act and as part of its commitment to improve service delivery and performance, a service standard for the recovery of fees in the TDG MOC Facilities Registration Program has been developed and would be in place when the proposed order comes into force. The service standard would indicate that within 45 business days of TC receiving an application, a member of TDG Engineering Services would review the application and inform the applicant whether an inspection is required or issue a certificate. The proposed service standard would come into effect the day the ministerial fees order comes into force.

TC’s remission policy has been in effect since April 2021 and would apply to this cost recovery initiative. In cases where a service standard is not met, a portion of the fee would be remitted to the client in accordance with the Service Fees Act, the Treasury Board Directive on Charging and Special Financial Authorities and the TC remissions policy. The remission policy states that, if a service standard is missed by 25% (12 days) or more, then 25% of the fee would be returned to the registrant. The remission policy does not apply to service standards missed by anything less than 12 days. Delays not caused by TC’s processing of the files (e.g. delays due to missing documents from the applicant) would not be calculated towards the 12 days.

Contact

Lisa Tellier
Acting Chief
Regulatory Development Division
Regulatory Frameworks and International Engagement Branch
Transportation of Dangerous Goods Directorate
Transport Canada
L’Esplanade Laurier
300 Laurier Avenue West
Ottawa, Ontario
K1A 1J2
Email: TC.TDGRegulatoryProposal-TMDPropositionReglementaire.TC@tc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Minister of Transport proposes to make the annexed Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment under subsection 29(1)footnote a of the Transportation of Dangerous Goods Act, 1992 footnote b.

Interested persons may make representations concerning the proposed Order within 60 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to Lisa Tellier, Acting Chief, Regulatory Development Division, Regulatory Frameworks and International Engagement Branch, Transportation of Dangerous Goods Directorate, Department of Transport, L’Esplanade Laurier (ASDD), 300 Laurier Avenue West, Ottawa, Ontario K1A 1J2 (email: TC.TDGRegulatoryProposal-TMDPropositionReglementaire.TC@tc.gc.ca).

Ottawa, March 2, 2023

Omar Alghabra
Minister of Transport

Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment

Definitions

Definitions

1 The following definitions apply in this Order.

certificate of registration
means a document that is issued by the Minister to the operator of a container facility, a design engineer or a service provider that certifies they are registered for the purposes of Part 5 of the Transportation of Dangerous Goods Regulations. (certificat d’enregistrement)
container facility
means a facility where any of the following activities is carried out in respect of a standardized means of containment that is used for the transportation of dangerous goods:
  • (a) design;
  • (b) manufacturing;
  • (c) repair; or
  • (d) requalification. (installation de contenants)
design engineer
means an individual who designs a standardized means of containment. (ingénieur de conception)
requalification
means the periodic testing or inspection of a standardized means of containment. (requalification)
service provider
means
  • (a) a person, other than the Minister, that provides to the operator of a container facility
    • (i) an inspection service,
    • (ii) a service for the validation of a container design facility, or
    • (iii) training; or
  • (b) an operator of a container facility that provides training to their employees. (fournisseur de services)

Fees and Costs

Certificate of registration

2 A person referred to in column 2 of the schedule who applies to the Minister for a certificate of registration or for the renewal of a certificate of registration must pay to the Minister, at the time of application, the corresponding fee set out in column 3.

Reimbursement of costs

3 If an employee of the Department of Transport must travel outside Canada to inspect a container facility as part of the review of an application for the issuance or renewal of a certificate of registration for that facility, the following costs associated with that travel are to be calculated in accordance with the rates set out in the National Joint Council Travel Directive, as amended from time to time, and are payable to the Minister by the operator of that facility:

Coming into Force

180th day after publication

4 This Order comes into force on the 180th day after the day on which it is published in the Canada Gazette, Part II.

SCHEDULE

(Section 2)

Fees Payable
Item

Column 1

Period

Column 2

Applicant

Column 3

Initial Registration or Renewal ($)

1 Period ending on March 31, 2025 Operator of a container facility 1,020
    Service provider 1,020
    Design engineer 485
2 Period beginning on April 1, 2025 and ending on March 31, 2026 Operator of a container facility 1,190
    Service provider 1,190
    Design engineer 565
3 Period beginning on April 1, 2026 and ending on March 31, 2027 Operator of a container facility 1,360
    Service provider 1,360
    Design engineer 646
4 Period beginning on April 1, 2027 and ending on March 31, 2028 Operator of a container facility 1,530
    Service provider 1,530
    Design engineer 727
5 Period beginning on April 1, 2028 Operator of a container facility 1,700
    Service provider 1,700
    Design engineer 808

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