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Supreme Court rules environmental impact legislation largely unconstitutional

Canada’s top court has delivered a highly anticipated judgment, writing in a majority opinion that Ottawa’s Impact Assessment Act (IAA) is largely unconstitutional.

The IAA, previously known as Bill C-69, allows federal regulators to consider the potential environmental and social impacts of various resource and infrastructure projects. It was enacted in 2019. 

The IAA has long been controversial among conservative politicians in Alberta, including former premier Jason Kenney, who frequently referred to it as the “no more pipelines act.”

The ruling was part of a “reference case,” which involves the provincial and federal governments asking courts for advisory opinions.

It doesn’t mean the law is now off the books — a ruling such as this from the Supreme Court of Canada is not necessarily binding, but is traditionally treated as being binding by governments, noted David Wright, an associate professor in the Faculty of Law at the University of Calgary.

“I think what we can expect is the federal government is going to get to work very quickly to put together a suite of amendments to bring the act into conformity with the law,” Wright said.

Details of the decision

Writing for the majority in a 5-2 decision, Chief Justice of the Supreme Court of Canada Richard Wagner said the process set forth in Sections 81 to 91 of the IAA were constitutional and could be separated out. 

Those sections involve projects carried out or financed by federal authorities on federal lands, or outside Canada, and therefore fall under federal jurisdiction. Those provisions were not challenged as unconstitutional. 

However, Wagner wrote that the balance of the scheme, involving “designated projects,” was unconstitutional. 

Under the IAA, designated projects are those projects that are set out in the regulations or are subject to a ministerial order.

“In my view, Parliament has plainly overstepped its constitutional competence in enacting this designated projects scheme,” Wagner wrote.

A building is shown in the background, with a sign that reads Supreme Court of Canada shown in the foreground.
Dissenting Justices Andromache Karakatsanis and Mahmud Jamal wrote that they believed the Impact Assessment Act was constitutional in its entirety.  (Adrian Wyld/The Canadian Press)

Wagner wrote that environmental protection remains one of today’s most pressing challenges, and Parliament has the power to enact a scheme of environmental assessment to meet this challenge.

“But Parliament also has the duty to act within the enduring division of powers framework laid out in the Constitution,” he wrote.

Dissenting Justices Andromache Karakatsanis and Mahmud Jamal wrote that they believed the act was constitutional in its entirety. 

“Environmental protection requires action by all levels of government because each — whether by action or inaction — can affect the environment,” the dissenting opinion reads.

“This shared responsibility is ‘neither unusual nor unworkable’ in a federal state such as Canada. Rather, it reflects this Court’s flexible approach to federalism, which recognizes that overlapping powers are unavoidable and intergovernmental cooperation is essential.”

Alberta government had previously challenged act

Alberta previously filed a constitutional challenge with the Alberta Court of Appeal, and was supported by the governments of Saskatchewan and Ontario, three First Nations and the Indian Resource Council.

Various environmental and legal groups, as well as other First Nations, supported Ottawa. In a 4-1 decision, the court called the law an “existential threat” when it came to Canada’s Constitution.

The federal government appealed that non-binding opinion, and the Supreme Court held hearings on the act in March. Today’s decision was keenly awaited by legal experts, who recognized its importance in providing clarity to an area of law that has long been under debate. 

A man and a woman sit at a table to address members of Canada's Senate.
Jason Kenney opposed Bill C-69 when he was Alberta’s premier. In this photo from 2019, Kenney is joined by Sonya Savage, the province’s energy minister at the time, in addressing the bill at the Senate of Canada Building on Parliament Hill. (Justin Tang/Canadian Press)

Wright, the associate professor in the Faculty of Law at the University of Calgary, said it wasn’t the outcome most of those who follow this area of law expected.

“This really does set the the legal landscape for federal impact assessment for decades to come,” said Wright, who was also an intervener on the case. “What we now know is that there are significant constraints on what the federal government may or may not do with respect to legislating in relation to environmental assessment.”

Though the decision of the majority was that the act was an instance of federal overreach, it did affirm that the federal government has the power to enact environmental assessment legislation, Wright noted.

“But in this case, the federal government went too far in exercising that power, or in trying to exercise the power that they thought they had,” Wright said.

Smith and Kenney celebrate decision

During a press conference held Friday, Alberta Premier Danielle Smith said the decision marked a substantial win “for the protection of provincial rights in our province.”

“Today’s decision only strengthens our legal position. We work to protect Albertans, and all Canadians, from federal intrusion into our provincial jurisdiction,” Smith said.

In his decision, Wagner wrote that “the fact that a project involves activities primarily regulated by the provincial legislatures does not create an enclave of exclusivity.”

When asked what that would mean for the province, Smith said her government was working collaboratively.

“I guess we can keep on battling this out in the Supreme Court to find out exactly where the line is, but I’m asking for the [federal government] to accept that there is exclusive provincial jurisdiction under the Constitution … and to work with us on those areas of shared priority,” Smith said.

Smith also thanked former premier Kenney as part of her remarks.

“[He] tirelessly fought back against federal overreach during his term as premier,” Smith said.

WATCH | Alberta Premier Danielle Smith speaks at press conference after Supreme Court of Canada decision:

supreme court rules environmental impact legislation largely unconstitutional 2

Smith ‘extremely pleased’ on Supreme Court ruling

15 hours ago

Duration 0:55

Featured VideoAlberta Premier Danielle Smith reacts to news that the federal Impact Assessment Act, previously known as Bill C-69, is ruled unconstitutional by Canada’s top court.

In an interview, Kenney said he was “thrilled” with the decision, calling it a “historic win” for Alberta. He said he wasn’t surprised to learn of the decision and pointed to the Alberta Court of Appeal case.

“It was a 4-1 decision, with a very powerful majority by the Chief Judge, saying that the Trudeau Impact Assessment Act was a wrecking ball to the Constitution. So they used the strongest language I’ve ever seen,” Kenney said.

“I really think that set the tone, the parameters and the stakes for the Supreme Court of Canada. I also worked really hard at getting eight of the other provinces on-side.”

WATCH | Former Alberta premier Jason Kenney reacts to news that the Supreme Court has ruled the Impact Assessment Act largely unconstitutional:

supreme court rules environmental impact legislation largely unconstitutional 3

‘A historic day:’ Jason Kenney reacts to Impact Assessment Act decision

11 hours ago

Duration 1:19

Featured VideoThe Impact Assessment Act has long been controversial among conservative politicians in Alberta, including former premier Jason Kenney. In an interview with CBC, Kenney says the Supreme Court ruling is a reminder that provinces do have important powers.

When asked about his view of Ottawa’s suggestion of adding amendments to the act, Kenney said that Ottawa was “maybe talking about some cosmetic face-saving.”

“It would be nice to have some actual darn humility here … it’s over, it’s done, stick a fork in it, and come back to the drawing board with an approach that collaborates with the provinces,” he said.

Reaction from across the country

Reaction from across the country came swiftly on Friday, including from Ontario Premier Doug Ford, who said his province welcomed the decision.

“The federal impact assessment process needlessly duplicated Ontario’s rigorous and world-leading environmental assessment requirements,” Ford is quoted as saying in a statement.

“At a time when it’s never been more important to build critical infrastructure, including highways, transit, and critical mineral projects, we now have the certainty we need to get shovels in the ground.”

Speaking in Vancouver, Conservative Leader Pierre Poilievre called the decision “good news.”

“A Poilievre government will repeal this law entirely and replace it with one that consults First Nations, protects our pristine environment, but gets jobs approved so that we can bring home beautiful, powerful paycheques to this country,” he said.

The Canadian Association of Petroleum Producers (CAPP), an intervener in the process, also said it was pleased with the decision.

“In the spirit of the court’s call for co-operation, CAPP looks forward to collaborating with both the federal and provincial governments to ensure that projects in the national interest — those reinforcing energy security, providing lower emissions energy, and maintaining affordability to Canadians — will proceed in a timely manner,” wrote Lisa Baiton, CAPP president and CEO, in a statement.

Joshua Ginsberg with Ecojustice, an environmental law charity, said it was disappointing to hear that an “important environmental law had been weakened” due to constitutional problems. Ecojustice was also an intervener in the process.

“In the end, I’m positive and hopeful that we’re going to come out of this with a clearer and effective environmental assessment process,” Ginsberg said. 

Guilbeault says Ottawa remains committed

Federal Environment Minister Steven Guilbeault and Energy and Natural Resources Minister Jonathan Wilkinson held a joint virtual media availability on Friday morning to respond to the ruling.

During that event, Guilbeault said Ottawa respected the role of the Supreme Court and would follow the court’s guidance, and work to improve the legislation through Parliament.

A man wearing a suit speaks in front of a microphone.
Minister of Environment and Climate Change Steven Guilbeault said the government’s immediate priority would be to provide guidance to stakeholders and Indigenous partners after the Supreme Court of Canada’s decision. (Adrian Wyld/The Canadian Press)

“We accept the court’s opinion. It provides new guidance on the Impact Assessment Act, while explicitly affirming the right of the government of Canada to put in place impact assessment legislation and collaborate with provinces on environmental protection,” he said.

“We developed the Impact Assessment Act to create a better set of rules that respect the environment, Indigenous rights and ensure projects get assessed in a timely way. We remain committed to these principles.”

There are currently 23 projects in the federal impact assessment process under the IAA, according to the Impact Assessment Agency of Canada. Eight final decisions have been issued by the minister or the agency allowing those projects to move forward.

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