Vol. 133, No. 31 — July 31, 1999

Regulations Amending the Atlantic Pilotage Tariff Regulations, 1996

Statutory Authority

Pilotage Act

Sponsoring Agency

Atlantic Pilotage Authority

REGULATORY IMPACT ANALYSIS STATEMENT

Description

The Atlantic Pilotage Authority (the Authority) is responsible for administering, in the interests of safety, an efficient pilotage service within the Canadian waters in and around the Atlantic Provinces. In addition, the Authority prescribes tariffs of pilotage charges that are fair and reasonable and consistent with providing revenues sufficient to permit the Authority to operate on a self-sustaining financial basis.

The Whiffen Head Transshipment Terminal, situated near the head of Placentia Bay, in Newfoundland, began to receive oil from the Hibernia offshore oil field in 1998. This oil terminal is approximately 1.5 miles due south of the Come-by-Chance Oil Refinery Terminal.

Bunkers can be obtained at the Come-by-Chance terminal and ships, when departing from the Whiffen Head Terminal, could avail themselves of this service provided the cost associated in making such a move was sufficiently attractive. Prior to the opening of the Whiffen Head Terminal, all movages in Placentia Bay were from an anchorage to the Come-by-Chance terminal and this is reflected in the existing movage charges. Consequently, the current tariff charges are being amended to accommodate movages between these two oil terminals and to provide an incentive for shipowners to bunker their ships at the Come-by-Chance terminal.

Alternatives

Maintaining the pilotage charge at the current level for changing berths between these two terminals was considered and rejected, since such a movage requires less labour and fewer resources than a typical movement within the Placentia Bay area. The proposed reduction in the movage charges reflects the actual costs for pilotage services being performed and the anticipated increase in movages between the two terminals will contribute to the Authority's financial self-sufficiency.

Benefits and Costs

The amendment constitutes a reduction in charges for ship movements between these two specified facilities. The unit charge and basic charge will be reduced from 80 percent of the trip rate to 50 percent of the trip rate for Placentia Bay Zone A. Schedule 4 is amended to include a sub-item under item 6 specifically for this type of movage.

It is anticipated that these reduced charges will generate an increase in the number of movements between these two terminals. Such growth would benefit both the Authority and the province of Newfoundland economically.

Consultation

Consultation has taken place with the parties affected by these proposed amendments in the form of several meetings and correspondence. The primary consultation has been with Newfoundland Transshipment Limited and North Atlantic Refineries Limited, the operators of the aforementioned terminals. Consultations also took place with agents, the Government of Newfoundland and other interested parties in the area. The participants in the consultation process have fully supported the proposed tariff adjustment.

Compliance and Enforcement

Section 45 of the Pilotage Act provides the enforcement mechanism for these Regulations in that a Pilotage Authority can inform a customs officer at any port in Canada to withhold clearance from any ship for which pilotage charges are outstanding and unpaid.

Contact

Captain R. A. McGuinness, Chief Executive Officer, Atlantic Pilotage Authority, Purdy's Wharf, Tower 1, Suite 1402, 1959 Upper Water Street, Halifax, Nova Scotia B3J 3N2, (902) 426-2550 (Telephone), (902) 426-4004 (Facsimile).

PROPOSED REGULATORY TEXT

Notice is hereby given, pursuant to subsection 34(1)(see footnote a) of the Pilotage Act, that the Atlantic Pilotage Authority, pursuant to section 33(see footnote b) of that Act, proposes to make the annexed Regulations Amending the Atlantic Pilotage Tariff Regulations, 1996.

Interested persons who have reason to believe that any charge in the proposed Regulations is prejudicial to the public interest, including, without limiting the generality thereof, the public interest that is consistent with the national transportation policy set out in section 5 of the Canada Transportation Act(see footnote c), may file a notice of objection setting out the grounds therefor with the Canadian Transportation Agency within 30 days after the date of publication of this notice. The notice of objection should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to the Canadian Transportation Agency, Ottawa, Ontario K1A 0N9.

ATLANTIC PILOTAGE AUTHORITY

CAPTAIN R. A. MCGUINNESS
Chief Executive Officer

REGULATIONS AMENDING THE ATLANTIC PILOTAGE TARIFF REGULATIONS, 1996

AMENDMENT

1. Item 6(see footnote 1) of Schedule 4 to the Atlantic Pilotage Tariff Regulations, 1996(see footnote 2) is replaced by the following:

Item	Column 1 Compulsory Pilotage Area	Column 2 Flat Charge ($)	Column 3 Minimum Charge ($)	Column 4 Unit Charge, No Pilot Boat Used ($)
6.	Placentia Bay (Zone A only), Nfld.
	(a) between Whiffen Head and Come-by-Chance terminals	n/a	538.00	1.94
	(b) any other area	n/a	538.00	3.10

Item	Column 1 Compulsory Pilotage Area	Column 5 Basic Charge, No Pilot Board Used ($)	Column 6 Unit Charge, Pilot Board Used ($)	Column 7 Basic Charge, Pilot Board Used ($)
6.	Placentia Bay (Zone A only), Nfld.
	(a) between Whiffen Head and Come-by-Chance terminals	269.00	n/a	n/a
	(b) any other area	430.00	3.48	484.00

COMING INTO FORCE

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

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Regulations Amending the Immigration Regulations, 1978

Statutory Authority

Immigration Act

Sponsoring Department

Department of Citizenship and Immigration

REGULATORY IMPACT ANALYSIS STATEMENT

Description

Section 14 of the Immigration Regulations, 1978 requires that, except for prescribed exceptions such as citizens of the United States, every immigrant and every visitor to Canada shall be in possession of a valid and subsisting passport issued by the country of which he/she is a citizen or national.

This amendment adds the passport of Somalia to item 3 of Schedule VII of the Immigration Regulations, 1978, thereby declaring the Somali passport to be a Travel Document which is invalid for travel to Canada. This is not the first time that Canada has withdrawn our recognition of a travel document. It is also not the first time that we have gone to the length of not recognizing any form of travel document issued by a regime which claims to be the government of a particular political entity.

As in all such cases, the rationale for this change is that the Somali passport fails to meet any of the basic standards for a valid and subsisting travel document: there is no government in Somalia competent to issue passports; there is no security of document issuance; and there is no legally-constituted government in Somalia which can guarantee re-entry to Somalia for the bearer.

The Somali passport has been considered unreliable as proof of identity or nationality for some time. Although Canada was the first country to identify the problem, other countries have gone farther to control the abuse. The United States declared the Somali passport invalid for visa purposes on October 23, 1993. Germany, Sweden, the Benelux countries and Australia also no longer recognize Somali passports issued after the fall of Siad Barré. Moreover, many airlines deny boarding to travellers holding Somali passports due to similar integrity concerns which essentially render the document de facto invalid for travel on those carriers. This amendment will bring Canada into line with the many other countries which have already taken similar action.

Other legitimate travel documents are available to Somali refugees, immigrants and visitors. Refugees and permanent residents can obtain Canadian Refugee Travel Documents or Certificates of Identity to travel from Canada. Refugees and immigrants selected abroad can travel to Canada on Red Cross travel documents or Minister's Permits. Minister's Permits can be similarly issued in those few cases in which Somalis are proceeding to Canada as visitors. (Less than 50 visitor applications have been made by Somalis to our High Commission in Nairobi in the last four years.)

Somali passports will likely continue to be presented as proof of nationality and identity to the Immigration and Refugee Board and to Canada Immigration Centres but it is expected that the numbers will dwindle over time. The Immigration and Refugee Board is well aware of the problems with Somali passport. Under current legislation, refugee claimants who provide Somali passports as their sole proof of identity are dealt with as would any other claimant who provides unreliable identification and may present a variety of documents as evidence of their identity, including statutory declarations.

The Somali passport continues to pose control and enforcement problems within Canada. These problems include imposters, Somalis and non-Somalis alike, using blank or recycled Somali passports to enter Canada, to support refugee claims (sometimes multiple) and to cash social assistance and other cheques.

Alternatives

The only alternative to the proposed action would be to maintain the status quo. This alternative was rejected because it would perpetuate the notion that Canada believes the Somali passport to be a credible travel document. It would also continue to support the market for illegally-procured or illegally-issued Somali documents to Somalis and to those posing as Somalis.

Benefits and Costs

Although estimates are not available, financial benefits would likely accrue to those jurisdictions which are paying shelter and welfare benefits to persons who are improperly using the Somali passport as a means of identity to substantiate their claims.

There will be no significant financial impact on the processing of refugee claimants in Canada, on the Canadian Passport Office, or on Canadian missions abroad.

Consultation

The Immigration and Refugee Board was consulted and has indicated that the addition of the Somali passport to Schedule VII will not affect the decisions of the Board. Board members will continue to assess the Somali passport in combination with other evidence presented.

The Canadian Passport Office does not feel that the number of requests for Canadian Travel Documents will impact seriously on their operations.

The Minister of Foreign Affairs supports the addition of the Somali passport to Schedule VII.

In the past, some members of the Somali community have expressed displeasure about the failure of Canada and other countries to accept the Somali passport at face value. The 60-day pre-publication period of this proposed regulatory change in the Canada Gazette provides the Somali community with an opportunity to respond to this initiative.

Compliance and Enforcement

No change to existing mechanisms is required. The airlines are subject to financial penalties if they allow improperly-documented passengers to board Canada-bound aircraft. All violations are reported by port of entry officials. Persons who are found to be inadmissible at ports of entry have the right to appeal a negative decision to the Immigration Appeal Division of the Immigration and Refugee Board.

Contact

Gary Blachford, Director, Intelligence and Interdiction, Enforcement Branch, Citizenship and Immigration Canada, Jean Edmonds Tower North, 9th Floor, 300 Slater Street, Ottawa, Ontario K1A 1L1, (613) 954-6061.

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to subsection 114(1) (see footnote d) of the Immigration Act, proposes to make the annexed Regulations Amending the Immigration Regulations, 1978.

Any interested person may make representations concerning the proposed amendments within 60 days after the date of publication of this notice. All such representations must be addressed to the Director, Intelligence and Interdiction, Enforcement Branch, Citizenship and Immigration Canada, Jean Edmonds Tower North, 9th Floor, 300 Slater Street, Ottawa, Ontario K1A 1K1, and cite the Canada Gazette, Part I, and the date of this notice.

Ottawa, July 27, 1999

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

REGULATIONS AMENDING THE IMMIGRATION REGULATIONS, 1978

AMENDMENT

1. Section 3 of Schedule VII to the Immigration Regulations, 1978(see footnote 3) is amended by adding the following after subsection (3):

(4) Any passport purporting to be issued by Somalia.

COMING INTO FORCE

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

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Regulations Amending the CES Grant Regulations

Statutory Authority

Department of Human Resources Development Act

Sponsoring Department

Department of Human Resources Development

REGULATORY IMPACT ANALYSIS STATEMENT

Description

The Canada Education Savings (CES) Grant was announced as part of the Canadian Opportunities Strategy in the February 1998 federal budget. Part III.1 of the Department of Human Resources Development Act, which received royal assent on June 18, 1998, and the related CES Grant Regulations, which came into force on October 22, 1998, set out the conditions for payment of a CES grant. The CES grant provides an incentive for parents and others to save in registered education savings plans (RESPs) for the post-secondary education needs of their children and other beneficiaries. A CES grant of 20 percent is paid on contributions to RESPs for eligible beneficiaries, up to an annual maximum of $400 and a lifetime maximum of $7,200. Human Resources Development Canada made the first CES grant payments to trustees of RESPs in November 1998.

To ensure the Government's ability to make payments in 1998, it was anticipated that the CES Grant Regulations would need to be phased in, with the first phase of the Regulations allowing for the payment or repayment of a CES grant and the second phase adding any necessary refinement to ensure the Regulations operate as intended. The proposed Regulations Amending the CES Grant Regulations constitute the second phase of this process and are outlined below.

— The current definition of "grant account" in section 1 is modified so that a grant account will be debited or credited with grants paid to or repaid from a RESP as provided for in amended sections 4, 9, 10 and 13. This is merely a change to the structure of the Regulations and does not change the operation of a grant account maintained in connection with a RESP.

— Section 6 causes a RESP beneficiary to be ineligible to receive a CES grant for a period of time following the withdrawal of pre-1998 contributions after February 23, 1998. Subsection 6(1) is amended to clarify that an individual who becomes a beneficiary under the RESP after the date of the withdrawal is not considered an ineligible beneficiary.

— Subsection 6(2) describes the circumstances in which a beneficiary will not become an ineligible beneficiary after the withdrawal of pre-1998 contributions. Subsection 6(2) is amended to add a new condition. A beneficiary will not become ineligible if the amount is withdrawn in order to reduce a RESP overcontribution situation provided the overcontribution is not more than $4,000 at the time of the withdrawal.

— Section 9 describes the calculation of the portion of an educational assistance payment that is attributable to CES grant. Subsection 9(3) describes two circumstances in which an educational assistance payment does not include a portion attributable to CES grant, that is, under paragraph 9(3)(a), when the beneficiary is not resident in Canada at the time of the payment, and, under paragraph 9(3)(b), when the beneficiary was over 21 years of age when named as a beneficiary under the RESP. Subsection 9(3) has been modified to describe only the circumstance in paragraph 9(3)(a), and a new subsection 9(4) is added to describe the circumstance in paragraph 9(3)(b).

— New subsection 9(4) modifies paragraph 9(3)(b) to ensure that it applies only to a RESP that allows more than one beneficiary at any one time, commonly referred to as a family plan. New subsection 9(4) provides that the portion of an educational assistance payment made to a beneficiary of a family plan that is attributable to CES grant is nil if the beneficiary became a beneficiary after attaining 21 years of age, unless, immediately before being named as beneficiary, the beneficiary had been a beneficiary of another family plan while under age 21.

— Section 10 describes the situations in which the CES grant must be repaid to the Minister of Human Resources Development.

Subsection 10(4) provides for an exception to the requirement to repay grant for group RESPs but only in limited circumstances. Subsection 10(4) is amended to clarify that a trustee of a group RESP is not exempted from the requirement to repay grant in the situations described in paragraphs 10(2)(b), (c), (e) or (f). Subsection 10(4) is further modified to clarify that the exception to the requirement to repay grant only applies if the grant is reallocated at the same time as the event that would otherwise have caused the repayment.

— New subsection 10(6) provides for an exception to the requirement to repay grant when assisted contributions are withdrawn at a time when the beneficiary is not eligible to receive an educational assistance payment if the withdrawal is to reduce an overcontribution situation provided the over-contribution is not more than $4,000 at the time of the withdrawal.

— Section 12 requires a RESP beneficiary to repay any amounts of CES grant paid to the beneficiary as educational assistance payments that exceed $7,200. This section is amended to clarify that it is the total of the grant portions of all educational assistance payments that have been made under all RESPs to the beneficiary that determines whether the $7,200 limit has been exceeded.

— Section 13 describes the conditions under which a transfer of property from one RESP to another RESP will be considered an eligible transfer for purposes of the CES grant. When a transfer occurs that is not an eligible transfer, CES grant is repaid to the Government. Section 13 currently requires all the property held under the transferring RESP to be transferred and requires the beneficiaries in the transferring and receiving RESPs to be the same. These conditions are amended as follows:

— Paragraph 13(1)(b) is replaced with new paragraph 13(1)(a) to bring the CES grant transfer conditions into alignment with the RESP transfer conditions in the Income Tax Act. A transfer will be considered an eligible transfer for CES grant purposes when it meets the conditions in subparagraph 204.9(5)(c)(i) or (ii) of the Income Tax Act, namely when there is a beneficiary in common in the transferring and receiving RESPs or when a beneficiary of the transferring RESP is a brother or sister of a beneficiary who is under 21 years of age in the receiving RESP.

— Current paragraph 13(1)(a) requires all the property held under the transferring RESP to be transferred to the receiving RESP. This paragraph is deleted so that a partial transfer can occur without causing repayment of CES grant. New subsection 13(2) stipulates that the notional accounts held in connection with a RESP are considered to be transferred on a proportionate basis in the case of a partial transfer and new subsection 13(4) provides for the debiting and crediting of the respective grant accounts with the proportionate amount of grant that is considered to have been transferred. Subsection 13(2) becomes new subsection 13(3) and is clarified so that it provides for the debiting and crediting of the respective grant accounts when the transfer is a full transfer. Current subsections 13(3) and (4) are renumbered as new subsections 13(5) and (6), respectively, and are modified for clarity only.

Alternatives

The proposed amendments to the CES Grant Regulations are necessary to ensure the Regulations operate as originally intended and to ensure that the conditions imposed on RESP beneficiaries and subscribers are not unduly restrictive. The proposed amendments constitute the final phase in the development of the CES Grant Regulations and, as such, no alternatives were considered.

Benefits and Costs

The number of financial institutions marketing RESPs tripled in the first year of the Canada Education Savings Grant Program and the number of RESP contracts held by individuals increased from approximately 700 000 to 1 000 000. The number of new RESPs is expected to continue to increase over the next few years. The CES Grant Program paid approximately $140 million in CES grant to date for an estimated 500 000 RESP beneficiaries and expects to pay approximately $300 million per year by the next fiscal year. An increased level of RESP savings improves the access to post-secondary education without students having to incur a heavy debt-load.

The proposed amendments clarify the intent of the existing Regulations without imposing new restrictions. The proposed amendments also provide a relieving measure so that a RESP subscriber can correct an inadvertent overcontribution to a RESP without incurring a CES grant penalty. Finally, the proposed amendments bring the CES grant transfer conditions into alignment with the tax rules, making it easier to understand the rules and giving RESP subscribers more flexibility in the management of their savings accounts.

The proposed amendments are not expected to adversely affect RESP promoters or trustees.

Consultation

RESP promoters and trustees who deliver the CES grant to RESP subscribers and beneficiaries were consulted extensively throughout the development of the initial CES Grant Regulations. The proposed Regulations Amending the CES Grant Regulations represent a refinement of the initial Regulations, and, for the most part, are as a result of comment from the financial services industry. The CES Grant Program has undertaken both formal and informal consultation with its stakeholders and delivery partners throughout its implementation and plans to continue this process once it is fully functional. RESP promoters and trustees will have an opportunity to comment on the proposed amendments at an industry consultation session planned for September 1999.

Compliance and Enforcement

Human Resources Development Canada has entered into agreements with RESP trustees and promoters for the delivery of the CES grant. The agreements impose conditions on RESP trustees and promoters in relation to the payment of the grant and include the requirement to report information to the Minister of Human Resources Development and to make records available for audit purposes. These agreements and other compliance mechanisms currently in place at Human Resources Development Canada will ensure conformity with the proposed amendments.

Year 2000 Note

This initiative will not impact negatively on the ability of the federal government, other levels of governments, or the private sector to achieve Year 2000 compliance.

Contact

Dianne Coates, Manager, Program Policy and Legislative Interpretation, Canada Education Savings Grant Program, Learning and Literacy Directorate, Human Resources Investment Branch, Human Resources Development Canada, Ottawa, Ontario K1A 0J9, (819) 953-5607 (Telephone), (819) 953-6500 (Facsimile).

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to section 33.6 of the Department of Human Resources Development Act, proposes to make the annexed Regulations Amending the CES Grant Regulations.

Interested persons may make representations concerning the proposed amendments to the Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice and be addressed to Dianne Coates, Manager, Program Policy and Legislative Interpretation, Canada Education Savings Grant Program, Learning and Literacy Directorate, Human Resources Development Canada, Ottawa, Ontario K1A 0J9, (819) 953-5607 (Telephone), (819) 953-6500 (Facsimile).

Ottawa, July 27, 1999

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

REGULATIONS AMENDING THE CES GRANT REGULATIONS

AMENDMENTS

1. The definition "grant account" in subsection 1(1) of the CES Grant Regulations (see footnote 4) is replaced by the following:

"grant account" means, in respect of a RESP, an account that is debited and credited in accordance with these Regulations. (compte de subvention)

2. Section 3 of the Regulations and the heading before it are repealed.

3. (1) Paragraph 4(1)(a) of the Regulations is replaced by the following:

(a) 20% of the contribution, and

(2) Section 4 of the Regulations is amended by adding the following after subsection (3):

(4) Where a CES grant is paid in respect of a contribution made in a year to a RESP by a subscriber under the RESP, the grant account of the RESP is credited at that time with the amount of CES grant paid.

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

6. (1) For the purposes of paragraphs 4(2)(b) and 5(f) and subject to subsection (2), where contributions that were made to a RESP before 1998 are withdrawn from the RESP after February 23, 1998, any individual who is a beneficiary of the RESP at any time during the period beginning on February 24, 1998 and ending on the day of the withdrawal is an ineligible beneficiary throughout the period that begins on the day of the withdrawal and ends on the last day of the second year following the year in which the withdrawal is made.

(2) Subsection 6(2) of the Regulations is amended by striking out the word "or" at the end of paragraph (b), by adding the word "or" at the end of paragraph (c) and by adding the following after paragraph (c):

(d) the withdrawal is all or part of an excess amount of contributions to reduce the amount of tax otherwise payable under Part X.4 of the Income Tax Act, and, at the time of the withdrawal, the excess amount for the year is not greater than $4,000.

5. (1) The portion of subsection 9(1) of the Regulations before paragraph (a) is replaced by the following:

9. (1) Subject to subsections (2) to (4) and for the purposes of these Regulations, the portion of an EAP made at any time to a beneficiary under a RESP that is attributable to CES grants is the lesser of

(2) Subsection 9(3) of the Regulations is replaced by the following:

(3) The portion of an EAP made to a beneficiary under a RESP that is attributable to CES grants is nil where the beneficiary is not resident in Canada at the time of the payment of the EAP.

(4) The portion of an EAP made to a beneficiary under a RESP that allows more than one beneficiary under the RESP at any time that is attributable to CES grants is nil where the beneficiary became a beneficiary under the RESP after attaining 21 years of age, unless, before attaining 21 years of age, the beneficiary had been a beneficiary under another RESP that allows more than one beneficiary under the RESP at any one time.

(5) Where an amount of CES grant is paid at any time as a portion of an EAP to a beneficiary under a RESP, the grant account of the RESP is debited at that time with the amount of CES grant paid.

6. (1) The portion of subsection 10(1) of the Regulations before paragraph (a) is replaced by the following:

10. (1) Subject to subsections (4) and (6), where assisted contributions are withdrawn from a RESP other than by way of transfer to another RESP at any time when no beneficiary under the RESP is eligible to receive an EAP, the trustee under the RESP shall, within the period set out in the CES grant agreement that applies to the RESP, repay to the Minister an amount equal to the lesser of

(2) Subsection 10(4) of the Regulations is replaced by the following:

(3.1) Where an amount of CES grant is repaid at any time to the Minister, the balance immediately before that time in the grant account of the RESP is debited at that time with the amount of CES grant repaid.

(4) A trustee under a particular group RESP who is required to repay, at any time, an amount of CES grant that has been paid to the particular RESP in respect of a beneficiary, other than in a situation described in paragraph (2)(b), (c), (e) or (f), is not required to repay the amount of the grant if

(a) the beneficiary has attained 18 years of age at that time; and

(b) the amount of CES grant is reallocated at that time in the same manner as income from the RESP is reallocated among the beneficiaries of the other group RESPs in the same arrangement.

(5) Where an amount of CES grant is reallocated as described in paragraph (4)(b) from a group RESP to other group RESPs in the same arrangement, the balance, immediately before the time of the reallocation, in the grant account

(a) of the RESP from which the grant is taken, shall be debited at that time with the amount of CES grant that is reallocated; and

(b) of each RESP to which a portion of the grant is reallocated, shall be credited at that time with that portion.

(6) A trustee under a particular RESP is not required to repay, at any time, any amount of CES grant paid in respect of a beneficiary where there is a withdrawal of contributions and the withdrawal is all or part of an excess amount of contributions to reduce the amount of tax otherwise payable under Part X.4 of the Income Tax Act, and, at the time of the withdrawal, the excess amount for the year is not greater than $4,000.

7. Section 12 of the Regulations is replaced by the following:

12. Where an individual who is or has been a beneficiary under one or more RESPs receives an EAP at any time and the total of all amounts each of which is the portion attributable to CES grants received by the individual from all RESPs at or before that time exceeds $7,200, the individual shall repay the excess to the Minister, to the extent that the excess has not been previously repaid.

8. Section 13 of the Regulations is replaced by the following:

13. (1) For the purposes of these Regulations, the transfer of an amount at any time from a RESP to another RESP is an eligible transfer if

(a) the transfer meets the conditions set out in subparagraph 204.9(5)(c)(i) or (ii) of the Income Tax Act; and

(b) the receiving RESP complies at that time with the conditions for registration set out in subsection 146.1(2) of the Income Tax Act that apply in respect of education savings plans entered into on January 1, 1999.

(2) For the purposes of these Regulations, where at any time less than all of the property held in connection with a RESP at that time is transferred to another RESP, the assisted contributions, unassisted contributions, CES grants and accumulated income are considered to be transferred in the same proportion as the value of the property transferred is to the total value of the property in the RESP at the time of the transfer.

(3) In the case of an eligible transfer, where all of the property held in connection with a RESP is transferred at any time to another RESP, the balance immediately before that time in the grant account of the transferring RESP is

(a) debited at that time to the grant account of the transferring RESP; and

(b) credited at that time to the grant account of the receiving RESP.

(4) In the case of an eligible transfer, where at any time less than all of the property held in connection with a RESP at that time is transferred to another RESP, the amount of CES grant that is considered to be transferred under subsection (2) is

(a) debited to the grant account of the transferring RESP; and

(b) credited to the grant account of the receiving RESP.

(5) For the purposes of these Regulations, in the case of an eligible transfer, an amount of CES grant that is transferred or is considered to be transferred under subsection (2) is considered to have been paid to the trustee under the receiving RESP.

(6) For the purposes of these Regulations, in the case of an eligible transfer, assisted contributions or unassisted contributions that are transferred or are considered to be transferred under subsection (2) are considered to have been made to the receiving RESP.

COMING INTO FORCE

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

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Regulations Prescribing Networks (Copyright Act)

Statutory Authority

Copyright Act

Sponsoring Department

Department of Industry

REGULATORY IMPACT ANALYSIS STATEMENT

Description

Bill C-32, An Act to amend the Copyright Act, received Royal Assent on April 25, 1997. Among the measures put in place by this bill are new rights for performers and sound recording makers as well as exceptions for non-profit schools, libraries, archives and museums.

There are also two exceptions which take into account the need of both radio and television broadcasters to make temporary copies (i.e. "ephemeral recordings") of performances so as to facilitate programming and broadcasting operations. Without these exceptions, broadcasters would first need to obtain the permission of the copyright owner in respect of each copyrighted work captured on the ephemeral recording. The exceptions are subject to certain conditions and limitations. For example, it is a condition of both exceptions that broadcasters destroy each ephemeral recording within 30 days of its making, unless the copyright owner consents otherwise. Broadcasters must keep a record of the date of making and of destruction of each ephemeral recording, including any other information prescribed by regulation. Further, the exceptions are not available in respect of copyrighted works for which a collective society of copyright owners licenses the making of ephemeral recordings.

(Note: The text which follows refers to "programming undertakings" and "broadcasting undertakings". These terms include entities such as television and radio stations; however, their specific legal definitions are set out in the Copyright Act.)

In particular:

(a) Section 30.8 of the Copyright Act allows a programming undertaking to make, for the purpose of deferred broadcasting, an ephemeral recording of a live performance which incorporates copyrighted works. This section also allows a programming undertaking to share, without having to obtain the permission of the copyright owners, its ephemeral recordings with other broadcasting undertakings, provided that both undertakings belong to the same "network" as prescribed by regulation;

(b) Section 30.9 of the Copyright Act allows a broadcasting undertaking to reproduce a sound recording of a copyrighted work in a format which facilitates the delivery of programming.

These Regulations prescribe networks for the purposes of section 30.8. Networks licensed pursuant to the Broadcasting Act are prescribed, as are any group of stations that are owned by the same person or group of persons and that have either a practice of common programming or an agreement by which they share programs. In other words, groups of stations that bear a strong resemblance to networks licensed by the Canadian Radio-television and Telecommunications Commission are also covered.

Alternatives

Networks must be prescribed by regulation before section 30.8 of the Copyright Act may be brought into force and there are no alternatives in this respect.

There is no overlap or duplication. The federal government has exclusive jurisdiction in this matter.

Benefits and Costs

Regulations prescribing networks will benefit certain programming and broadcasting undertakings. The Regulations are required to enable the sharing of ephemeral recordings within a network, which would otherwise not be possible. They do this by allowing broadcasting undertakings within a prescribed network to make and use a temporary copy of an ephemeral recording originally made by a programming undertaking belonging to the same network.

There will be no additional costs to the Government due to the implementation of these Regulations.

Consultation

The following associations were consulted before and during the regulation-drafting process: the Association canadienne de la radio et de la télévision de langue française inc. (ACRTF), the Association québécoise de l'industrie du disque, du spectacle et de la vidéo (ADISQ), the Canadian Association of Broadcasters (CAB), the Canadian Broadcasting Corporation (CBC), the Canadian Cable Television Association (CCTA), the Canadian Music Publishers Association (CMPA), the Canadian Recording Industry Association (CRIA), and the Society for Reproduction Rights of Authors, Composers and Publishers in Canada (SODRAC).

During these consultations, the departments received many comments and proposals which were considered in the development of a version that was pre-published in the Canada Gazette, Part I, on January 30, 1999. This version included provisions specifying other information for record-keeping purposes, as well as a provision prescribing networks.

Following prepublication, comments were received from the CAB, the CCTA, the CMPA, CRIA, and the Canadian Independent Record Producers Association (CIRPA).

The main comments relate to section 3 of the Regulations, as previously pre-published. This provision established the record-keeping requirements in respect of ephemeral recordings made pursuant to section 30.8. Associations representing copyright owners were very concerned that section 3 had been structured such that some of the requirements could be evaded and, on this basis, could not accept the Regulations. However, all of the alternatives discussed either contained elements that were unacceptable to some stakeholders, or, per the advice of the Department of Justice, were not within the regulation-making power set out in the Act.

Accordingly, the additional record-keeping requirements have been removed from the Regulations so as to allow the stakeholders an opportunity to reach a consensus amongst themselves without unduly delaying implementation of the remaining provisions of Bill C-32.

Given the extensive changes now proposed, the Regulations are being pre-published for a second time in the Canada Gazette, Part I, for a period of 15 days.

With respect to networks, comments were received concerning the requirement that stations falling within a network must be owned by the same person or group of persons. Certain stakeholders felt that this requirement is too restrictive. However, a wider designation would not be consistent with federal government policy, as expressed in our laws and in the international treaties to which Canada is a member. The relevant stakeholders were informed of these difficulties and support the implementation of this part of the Regulations.

Since pre-publication in January 1999, certain changes were made to the networks provisions to satisfy the Department of Justice requirements, but care has been taken to reflect the original policy intent.

Advance notice concerning prescribed networks was entered in the Report on Plans and Priorities for the Fiscal Year 1998-99.

Compliance and Enforcement

Not applicable. The Regulations merely prescribe networks.

Contacts

Éloïse Arbour, Policy Analyst, Copyright Policy, Department of Canadian Heritage, 15 Eddy Street, 4th Floor, Room 133, Hull, Quebec K1A 0M5, (819) 997-5088 (Telephone), (819) 997-5685 (Facsimile), eloise_arbour@pch.gc.ca (Electronic mail); and Albert Cloutier, Policy Analyst, Intellectual Property Policy Directorate, Department of Industry, 235 Queen Street, 5th Floor West, Ottawa, Ontario K1A 0H5, (613) 952-3804 (Telephone), (613) 952-1980 (Facsimile), cloutier.albert@ic.gc.ca (Electronic mail).

PROPOSED REGULATORY TEXT

Notice is hereby given that the Governor in Council, pursuant to section 30.8(see footnote e) and subsection 62(1)(see footnote f) of the Copyright Act, proposes to make the annexed Regulations Prescribing Networks (Copyright Act).

Any interested person may make representations concerning the proposed Regulations within 15 days after the date of publication of this notice. All such representations must be addressed to Albert Cloutier, Policy Analyst, Intellectual Property Policy Directorate, Department of Industry, 235 Queen Street, 5th Floor West, Ottawa, Ontario K1A 0H5, (613) 952-3804 (Telephone), (613) 952-1980 (Facsimile), or Éloïse Arbour, Policy Analyst, Copyright Policy Directorate, Department of Canadian Heritage, 15 Eddy Street, 4th Floor, Hull, Quebec K1A 0M5, (819) 997-5088 (Telephone), (819) 997-5685 (Facsimile), and cite the Canada Gazette, Part I, and the date of this notice.

Ottawa, July 27, 1999

MARC O'SULLIVAN
Assistant Clerk of the Privy Council

REGULATIONS PRESCRIBING NETWORKS (COPYRIGHT ACT)

NETWORK

1. For the purpose of subsection 30.8(9) of the Copyright Act, the following are prescribed networks:

(a) networks that are networks within the meaning of the definition "network" in subsection 2(1) of the Broadcasting Act; and

(b) networks that consist of two or more programming undertakings that are owned by the same person or group of persons and that have a practice of common programming or an arrangement by which they share programs, as the case may be.

COMING INTO FORCE

2. These Regulations come into force on October 1, 1999.

[31-1-o]

Footnote a

S.C., 1998, c. 10, s. 150

Footnote b

S.C., 1998, c. 10, s. 149

Footnote c

S.C., 1996, c. 10

Footnote 1

SOR/96-244

Footnote 2

SOR/95-586

Footnote d

S.C., 1992, c. 49, s. 102

Footnote 3

SOR/78-172

Footnote 4

SOR/98-528

Footnote e

S.C., 1997, c. 24, ss. 18(1)

Footnote f

S.C., 1997, c. 24, ss. 37(2)

NOTICE:
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