ARCHIVED — Vol. 148, No. 24 — November 19, 2014

Warning This Web page has been archived on the Web.

Archived Content

Information identified as archived is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please contact us to request a format other than those available.

Registration

SOR/2014-254 November 7, 2014

CANADIAN ENVIRONMENTAL PROTECTION ACT, 1999

Products Containing Mercury Regulations

P.C. 2014-1244 November 6, 2014

Whereas, pursuant to subsection 332(1) (see footnote a) of the Canadian Environmental Protection Act, 1999 (see footnote b), the Minister of the Environment published in the Canada Gazette, Part I, on February 26, 2011, a copy of the proposed Products Containing Mercury Regulations, substantially in the annexed form, under the title Regulations Respecting Products Containing Certain Substances Listed in Schedule 1 to the Canadian Environmental Protection Act, 1999, and persons were given an opportunity to file comments with respect to the proposed Regulations or to file a notice of objection requesting that a board of review be established and stating the reasons for the objection;

Whereas, pursuant to subsection 93(3) of that Act, the National Advisory Committee has been given an opportunity to provide its advice under section 6 (see footnote c) of that Act;

And whereas, in the opinion of the Governor in Council, pursuant to subsection 93(4) of that Act, the proposed Regulations do not regulate an aspect of a substance that is regulated by or under any other Act of Parliament in a manner that provides, in the opinion of the Governor in Council, sufficient protection to the environment and human health;

Therefore, His Excellency the Governor General in Council, pursuant to subsection 93(1) of the Canadian Environmental Protection Act, 1999 (see footnote d), on the recommendation of the Minister of the Environment and the Minister of Health, makes the annexed Products Containing Mercury Regulations.

PRODUCTS CONTAINING MERCURY REGULATIONS

APPLICATION

Application

1. (1) Subject to section 2, these Regulations apply to any product that contains mercury.

Mercury and its compounds

(2) For the purposes of these Regulations, mercury includes any of its compounds.

Non-application

2. These Regulations do not apply to

  • (a) waste;
  • (b) a product that is at the end of its useful life and that is intended to be recycled;
  • (c) a food, drug, or cosmetic as defined in section 2 of the Food and Drugs Act;
  • (d) a veterinary biologic as defined in subsection 2(1) of the Health of Animals Act;
  • (e) a surface coating material as defined in subsection 1(1) of the Surface Coating Materials Regulations or a surface coating material applied to a toy regulated under the Toys Regulations;
  • (f) a pest control product as defined in subsection 2(1) of the Pest Control Products Act;
  • (g) a feed as defined in section 2 of the Feeds Act;
  • (h) a fertilizer as defined in section 2 of the Fertilizers Act;
  • (i) an explosive regulated under the Explosives Act;
  • (j) ammunition and explosives under the direction or control of the Minister of National Defence;
  • (k) a product, other than a battery, that has a mercury concentration of 0.1% or less by weight in homogeneous materials;
  • (l) a battery, other than a button cell battery, that has a mercury concentration of 0.0005% or less by weight in homogeneous materials;
  • (m) beginning on January 1, 2016, a button cell battery that has a mercury concentration of 0.0005% or less by weight in homogeneous materials;
  • (n) from January 1, 2016 until December 31, 2019, a button cell battery that is incorporated into a medical device that is intended to remain in the body for at least 30 consecutive days;
  • (o) ores, concentrates and by-products of metallurgic operations; and
  • (p) an on-road vehicle as defined in subsection 1(1) of the On-Road Vehicle and Engine Emission Regulations that is of the 2016 model year or of a previous model year as determined under section 5 of those Regulations.

PROHIBITIONS

Manufacture or import

3. A person must not manufacture or import any product that contains mercury unless

  • (a) the product belongs to a product category set out in column 1 of the schedule, the maximum total quantity of mercury contained in the product is less than or equal to the quantity set out in column 2 and the person manufactures or imports the product on or before the end date set out in column 3; or
  • (b) the person holds a permit issued under subsection 5(1).

PERMITS

Application

4. An application for a permit must be submitted to the Minister in accordance with section 13 and must contain the following information and documents:

  • (a) respecting the applicant,
    • (i) their name, civic and postal addresses, telephone number and, if any, fax number and email address, and
    • (ii) if applicable, the name, title, civic and postal addresses, telephone number and, if any, fax number and email address of their duly authorized representative;
  • (b) respecting the product,
    • (i) its common or generic name and its trade name, if any,
    • (ii) the total quantity of mercury contained in the product, expressed in milligrams,
    • (iii) the estimated quantity to be manufactured or imported by the applicant in a calendar year, and
    • (iv) an identification and description of each known use;
  • (c) evidence that, at the time of the application, there is no technically or economically feasible alternative to or substitute for the product that
    • (i) achieves a similar result as would be achieved by using the product containing mercury, and
    • (ii) has a less harmful effect on the environment or on human health than the product containing mercury;
  • (d) a copy of a plan that identifies and describes the measures that the applicant will take to minimize or eliminate any harmful effect that the mercury contained in the product has or may have on the environment and human health, including measures to ensure that the mercury is handled safely and is not released into the environment during normal use of the product and at the end of its useful life;
  • (e) a statement that the plan is to be implemented within 30 days after the day on which the permit is issued; and
  • (f) the civic and postal addresses of the location where the information and supporting documents are kept.

Issuance

5. (1) Subject to subsection (2), the Minister must issue the permit if the following conditions are met:

  • (a) the applicant has established that, at the time of the application, there is no technically or economically feasible alternative to or substitute for the product that
    • (i) achieves a similar result as would be achieved by using the product containing mercury, and
    • (ii) has a less harmful effect on the environment or on human health than the product containing mercury; and
  • (b) the applicant has submitted the plan referred to in paragraph 4(d), and that plan sets out measures that can reasonably be regarded as measures that will minimize or eliminate any harmful effect that the mercury contained in the product has or may have on the environment and human health.

Refusal

(2) The Minister must refuse to issue a permit if

  • (a) the Minister has reasonable grounds to believe that the applicant has provided false or misleading information in support of their application; or
  • (b) the information and documents required under section 4 have not been provided or are insufficient to enable the Minister to process the application.

Expiry

(3) A permit expires three years after the day on which it is issued, unless it is renewed in accordance with subsection 6(2).

Renewal of permit — application

6. (1) In order to have a permit renewed, a permit holder must submit to the Minister a renewal application, in accordance with section 4, at least 90 days before the day on which the permit expires and must include the number of the permit in that renewal application.

Renewal

(2) The Minister must renew the permit if the conditions in subsection 5(1) are met.

Grounds for revocation

7. (1) The Minister must revoke a permit if the Minister has reasonable grounds to believe that the permit holder has provided false or misleading information.

Conditions for revocation

(2) Before revoking a permit, the Minister must provide the permit holder with

  • (a) written reasons for the revocation; and
  • (b) an opportunity to make written representations in respect of the revocation.

LABELLING

Label — products containing mercury

8. (1) Subject to subsections (3) to (5), any person that manufactures or imports a product that contains mercury must indicate the following information in a readily visible location on the product and, if applicable, on its package by means of a stamp, label or other mark:

  • (a) the statement “Contains mercury / Contient du mercure”;
  • (b) safe handling procedures and the measures to be taken in case of accidental breakage, the address of a website where that information is available, or contact information for a person who can provide that information;
  • (c) the options available for the disposal and recycling of the product in accordance with the laws of the jurisdiction where the disposal or recycling is to take place, the address of a website where that information is available, or contact information for a person who can provide that information; and
  • (d) a statement to the effect that the product should be disposed of or recycled in accordance with the applicable laws.

Information

(2) The information must

  • (a) appear in both official languages;
  • (b) be presented in a font size of at least 10 points with characters that are at least 3 mm in height, that are legible and indelible and that are impressed, embossed or in a colour that contrasts with the label’s background or the colour of the product, as applicable;
  • (c) be enclosed by a border; and
  • (d) be easily distinguishable from other graphic material on the product or its package.

Small product

(3) If the product is too small to accommodate the information, the information must be indicated

  • (a) in a readily visible location on the product’s package; or
  • (b) if there is no package or if the package is too small to accommodate the information, in a notice attached to the product or in a manual that accompanies the product. The notice or manual may provide the address of a website where the relevant information is available and must be provided
    • (i) in the case of a notice, in both official languages, and
    • (ii) in the case of a manual, in English, French or both official languages, as requested by the first retail purchaser.

Component of a product

(4) If the mercury is contained in a component of the product, the information must be indicated

  • (a) in a readily visible location on the product; or
  • (b) in a notice attached to the product or in a manual that accompanies the product. The notice or manual may provide the address of a website where the relevant information is available and must be provided
    • (i) in the case of a notice, in both official languages, and
    • (ii) in the case of a manual, in English, French or both official languages, as requested by the first retail purchaser.

Non-application

(5) Subsections (1) to (4) do not apply to

  • (a) products belonging to a product category referred to in any of items 31 to 34, column 1, of the schedule; or
  • (b) products that are manufactured for export.

Hg Symbol

9. (1) Any person that manufactures or imports any of the following products must ensure that the symbol Hg is indicated in a font size of at least 10 points with characters that are at least 3 mm in height or within a pictogram of a least 7 mm in height such that it is legible and indelible and impressed, embossed or in a colour that contrasts with the label’s background or the colour of the product, as applicable, in the following location:

  • (a) in the case of a product belonging to a product category referred to in any of items 2 to 9, 12 to 14, 22 or 23, column 1, of the schedule, in a readily visible location on the product; and
  • (b) in the case of a product that contains a product belonging to a product category referred to in item 10 or 11, column 1, of the schedule, in a readily visible location on an external surface of the product.

Small product

(2) Despite subsection (1), if a product referred to in paragraph (1)(a) is too small to accommodate the symbol Hg in a font size of at least 10 points with characters that are at least 3 mm in height, the symbol Hg must be indicated in the closest possible font size and character height and be, at a minimum, in a font size of 7 points with characters that are 2 mm in height.

TESTING REQUIREMENTS

ACCREDITED LABORATORY

Accredited laboratory

10. Any determination of total quantity of mercury made for the purposes of these Regulations must be conducted

  • (a) by a laboratory that is accredited by a Canadian accrediting body under the International Organization for Standardization standard ISO/IEC 17025:2005, entitled General requirements for the competence of testing and calibration laboratories, as amended from time to time, and the scope of whose accreditation includes the analytical method used to make the determination; or
  • (b) by a laboratory that is accredited under the Environment Quality Act, R.S.Q., c. Q-2, as amended from time to time, and the scope of whose accreditation includes the analytical method used to make the determination.
DETERMINATION OF THE TOTAL QUANTITY OF MERCURY IN ELECTROTECHNICAL PRODUCTS

Total quantity of mercury

11. The total quantity of mercury contained in an electrotechnical product is determined using the International Electrotechnical Commission standard IEC 62321-4:2013, entitled Determination of certain substances in electrotechnical products — Part 4: Mercury in polymers, metals and electronics by CV-AAS, CV-AFS, ICP-OES and ICP-MS, as amended from time to time.

REPORT

Reporting requirements

12. (1) Any person that manufactures or imports a product that contains mercury — other than a product belonging to the product category referred to in item 34, column 1, of the schedule — must submit a report to the Minister in respect of the 2016 calendar year and every third calendar year after that year, on or before March 31 of the calendar year following the year in respect of which the report is prepared.

Required information

(2) The report must include the following information:

  • (a) respecting the person,
    • (i) their name, civic and postal addresses, telephone number and, if any, fax number and email address, and
    • (ii) if applicable, the name, title, civic and postal addresses, telephone number and, if any, fax number and email address of their duly authorized representative; and
  • (b) respecting the product,
    • (i) its common or generic name and its trade name, if any,
    • (ii) the name of the product category, referred to in the schedule, to which the product belongs or the number of the permit issued under subsection 5(1), as the case may be,
    • (iii) the total quantity of mercury contained in the product, expressed in milligrams,
    • (iv) the quantity manufactured during the calendar year in question, if applicable, and
    • (v) the quantity imported during the calendar year in question, if applicable.

Component subject to these Regulations

(3) Subsection (1) does not apply to a person that manufactures a product the mercury content of which is contained in a component that is itself a product that was subject to these Regulations at the time of its manufacture or import.

FORMAT FOR SUBMISSION

Electronic submission

13. (1) Any information required to be submitted to the Minister under these Regulations must be submitted electronically in the form and format specified by the Minister and must bear the electronic signature of the person that manufactures or imports the product containing mercury or of their duly authorized representative.

Submission in writing

(2) If the Minister has not specified an electronic form and format or if it is not feasible to send the information electronically in accordance with subsection (1) because of circumstances beyond the person’s control, the information must be sent on paper in the form and format specified by the Minister and signed by the person or their duly authorized representative. If no form and format have been specified, the information may be sent in any form and format.

RECORD KEEPING

Records

14. (1) Any person that manufactures or imports a product that contains mercury must maintain records that demonstrate that the product was manufactured or imported in accordance with the Act and these Regulations and that include the following information:

  • (a) in the case of a person that manufactures a product,
    • (i) the common or generic name of the product manufactured, and its trade name, if any,
    • (ii) the name of the product category, referred to in the schedule, to which the product belongs or the number of the permit issued under subsection 5(1), as the case may be,
    • (iii) the quantity of the product manufactured at each manufacturing plant,
    • (iv) the total quantity of mercury contained in the product, expressed in milligrams, and
    • (v) the date of manufacture; and
  • (b) in the case of a person that imports a product,
    • (i) the common or generic name of the product imported, and its trade name, if any,
    • (ii) the name of the product category, referred to in the schedule, to which the product belongs or the number of the permit issued under subsection 5(1), as the case may be,
    • (iii) the quantity of the product imported,
    • (iv) the total quantity of mercury contained in the product, expressed in milligrams,
    • (v) the name, civic and postal addresses, telephone number and, if any, the fax number and email address of the principal place of business of the shipper,
    • (vi) the port of entry at which the product was imported,
    • (vii) the date of import,
    • (viii) the Harmonized Commodity Description and Coding System number for the product,
    • (ix) the importer number for the product shipped, and
    • (x) copies of the bill of lading, invoice and all documents submitted to the Canada Border Services Agency for the product shipped.

Retention of records

(2) The records and supporting documents must be kept for a period of at least five years after the day on which the records are made.

Retention of information submitted to Minister

15. Any person that submits information to the Minister under these Regulations must keep a copy of that information and any supporting documents for a period of at least five years after the day on which the information is submitted.

Place of retention

16. (1) The records, copies of information submitted to the Minister and supporting documents must be kept at the person’s principal place of business in Canada or at any other place in Canada where they can be inspected. If they are kept at any place other than the person’s principal place of business, the person must provide the Minister with the civic address of that place.

Change of address

(2) If the civic address referred to in subsection (1) changes, the person must notify the Minister in writing within 30 days after the change.

COMING INTO FORCE

One year after registration

17. These Regulations come into force one year after the day on which they are registered.

SCHEDULE
(Paragraphs 3(a), 8(5)(a) and 9(a) and (b), subsection 12(1) and subparagraphs 12(2)(b)(ii) and 14(1)(a)(ii) and (b)(ii))

MAXIMUM TOTAL QUANTITY OF MERCURY FOR CERTAIN PRODUCTS


Item Column 1




Product Category
Column 2


Maximum Total Quantity of Mercury in the Product
Column 3




End date
1. Dental amalgam No limit None
2. Compact fluorescent lamp for general lighting purposes    
  (a) ≤ 25 watts 4 mg per lamp None
  (b) > 25 watts 5 mg per lamp None
3. Straight fluorescent lamp for general lighting purposes    
  (a) T5, program start, with a normal lifetime (< 25,000 hours) 3 mg per lamp None
  (b) T8, 4-foot or less, instant and program start, medium bi-pin base, with a normal lifetime (< 25,000 hours) 4 mg per lamp None
  (c) T5, program start, with a long lifetime (≥ 25,000 hours) 5 mg per lamp None
  (d) T8, 4-foot or less, instant and program start, medium bi-pin base, with a long lifetime (≥ 25,000 hours) 5 mg per lamp None
  (e) T12, 4-foot or less, rapid start, medium bi-pin base 10 mg per lamp None
  (f) T12, 8-foot, instant start, single pin base 15 mg per lamp None
4. Non-linear fluorescent lamp for general lighting purposes, including a circular or square fluorescent lamp 15 mg per lamp None
5. Induction fluorescent lamp for general lighting purposes 15 mg per lamp None
6. Mercury vapour lamp for general lighting purposes    
  (a) ≤ 250 watts 40 mg per lamp December 31, 2017
  (b) > 250 watts and ≤ 400 watts 75 mg per lamp December 31, 2017
  (c) > 400 watts and ≤ 1000 watts 250 mg per lamp December 31, 2017
7. High pressure sodium vapour lamp for general lighting purposes 40 mg per arc tube None
8. Metal halide lamp for general lighting purposes    
  (a) ≤ 300 watts 40 mg per lamp None
  (b) > 300 watts and ≤ 500 watts 75 mg per lamp None
  (c) > 500 watts and ≤ 700 watts 85 mg per lamp None
  (d) > 700 watts and ≤ 1000 watts 250 mg per lamp None
9. Automobile headlamp 10 mg per lamp None
10. Cold cathode fluorescent lamp    
  (a) 1.5 m or less in length 10 mg per lamp None
  (b) more than 1.5 m in length 13 mg per lamp None
11. External electrode fluorescent lamp    
  (a) 1.5 m or less in length 5 mg per lamp None
  (b) more than 1.5 m in length 13 mg per lamp None
12. Cold cathode tubing for signage or cove lighting 100 mg per 2.44 m (8 feet) None
13. Electrode for use in cold cathode tubing for signage or cove lighting 100 mg per electrode None
14. Fluorescent and discharge lamps other than those referred to in items 2 to 13 No limit None
15. Very high accuracy capacitance and loss measurement bridges and high frequency RF switches and relays in monitoring and control instruments 20 mg per bridge, switch or relay None
16. Thermometer for use in a laboratory for scientific research applications No limit None
17. Thermometer or other scientific instrument required to be used by an ASTM International standard No limit None
18. Scientific instrument used for the calibration of medical devices or for the calibration of scientific research instruments No limit None
19. Laboratory analytical standard or reference material No limit None
20. Scientific instrument used as reference for clinical validation studies No limit None
21. Scientific instrument used for measuring the quantity of mercury in the environment No limit None
22. Radiation light detector No limit None
23. Infrared light detector No limit None
24. Low mercury chloride reference electrode No limit None
25. Low mercury sulphate reference electrode No limit None
26. Low mercury oxide reference electrode No limit None
27. Professional, commercial and industrial photographic film No limit None
28. Professional, commercial and industrial photographic paper No limit None
29. Composite resins and adhesive resins used in the aerospace industry 2% by weight None
30. Catalyst used in the manufacturing of polyurethane No limit None
31. Button cell battery 25 mg per battery December 31, 2015
32. Medical device that is intended to remain in the body for at least 30 consecutive days No limit December 31, 2019
33. In-vitro diagnostic assays and reagents No limit December 31, 2019
34. Replacement part (see note) if the product contained the part No limit None
  (a) before the coming into force of these Regulations; or (b) at the time of its manufacture or import, if that manufacture or import was permitted under these Regulations    

Note: Replacement part means a part that is required for a product to continue to function and for which there is no mercury-free alternative or product listed in this schedule that could serve as a direct substitute.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Executive summary

Issues: Mercury is a naturally occurring chemical element that is persistent, bioaccumulative and toxic at very low levels to human health and in aquatic and terrestrial ecosystems. Unlike any other metal, characteristics unique to mercury (liquid at room temperature and extreme volatility) give rise to risks from its use that must be addressed through appropriate risk management measures.

The Government of Canada (“Canada”) has taken action over the past few decades to reduce the risks posed by environmental releases of mercury, including the risks to human health posed by releases of this substance to air. According to data from Environment Canada’s National Pollutant Release Inventory, it is estimated that releases of mercury to air attributable to the use and end-of-life disposal of products were approximately 1 500 kg in 2010. This figure represents close to one third of Canada’s total mercury emissions to air that year from all sources including metal mining, base metal smelting and the combustion of coal. It is projected that, in the absence of risk management, Canada’s product-based mercury emissions will not decrease considerably, as it is expected that products containing unregulated amounts of mercury will continue to enter the Canadian marketplace in significant quantities.

Description: The Products Containing Mercury Regulations (the “Regulations”) will prohibit the manufacture and import of products containing mercury or any of its compounds, with some exemptions for essential products which have no technically or economically viable alternatives (e.g. certain medical and research applications, and dental amalgam). In the case of lamps, rather than introducing a prohibition, the Regulations will limit the amount of mercury contained in fluorescent and other types of lamps. This approach is expected to reduce the amount of mercury emissions from lamps, while providing consumer choice as the market transitions to adjust to Natural Resource Canada’s minimum energy performance standards for incandescent lamps. In addition, as part of a complementary risk management initiative, Environment Canada will develop a national code of practice and targeted guidance for the North concerning the environmentally sound management of lamps containing mercury in order to reduce the risk of mercury releases to the environment from their disposal.

Further, the Regulations will include labelling and reporting provisions for exempted products, and will identify the maximum total quantities of mercury allowed to be contained in some exempted products (i.e. the mercury content limits for some exempted products). The Regulations will also include labelling and reporting provisions for any product for which the manufacture or import is authorized through the issuance of a permit. A permit may be granted for the manufacture or import of a product containing mercury if the applicant has established that, at the time of application, there is no technically or economically feasible alternative to or substitute for the product that both: (i) achieves a similar result as would be achieved by using the product containing mercury; and (ii) has a less harmful effect on the environment or on human health than the product containing mercury.

The Regulations will come into force one year after the day on which they are registered.

Cost-benefit statement: The discounted costs of the Regulations are estimated to be $9 million (2012 Canadian dollars; present value base year of 2014; 3% discount rate), over a 19-year period (2014–2032), including (1) a cost to importers and consumers of $5.5 million due to increased prices and a cost to Government of $2.1 million; and (2) administrative costs of $1.4 million to manufacturers and importers as the result of additional learning and reporting.

From 2015 to 2032, the Regulations will lead to a cumulative reduction of approximately 41 000 kg of mercury entering the Canadian marketplace and, consequently, they will reduce environmental mercury releases to air by about 4 100 kg. The discounted benefits of mercury air emissions avoided under the regulatory scenario are estimated to be $18 million (2012 Canadian dollars; present value base year of 2014; 3% discount rate), or twice as large as the discounted costs of the Regulations. Altogether, the discounted net benefits of the Regulations are estimated to be $9 million.

“One-for-One” Rule and small business lens: The “One-for-One” Rule applies to the Regulations since they are a new Environment Canada regulatory initiative that will impose incremental administrative burden costs, or “INs”, on business. It is estimated that importers and manufacturers of products containing mercury will incur new annualized costs in the order of $91,500 or $25 per stakeholder (2012 Canadian dollars; present value base year of 2012; 7% discount rate; 10-year analytical time frame). However, the small business lens does not apply for two reasons: (1) nationwide annualized costs are projected to be below the threshold of $1 million in nationwide annualized costs which triggers the lens; and (2) the costs estimated to be incurred as a result of the Regulations will not be disproportionally high for small businesses operating in Canada.

Domestic and international coordination and cooperation: The Regulations will complement Canada’s diverse policy and program initiatives relating to mercury by targeting its use in and release from products. Internationally, the Regulations will be broadly consistent with the European Union’s risk management approach to managing mercury in products, as well as with those approaches employed in the United States by states, such as California, Connecticut, Maine, Oregon and Vermont. Finally, Canada has participated in global negotiations, which concluded in January 2013, in relation to the development of a legally binding instrument concerning mercury pollution, namely the Minamata Convention on Mercury. The Regulations will emphasize Canada’s leadership and participation in this international initiative.

Background

Substance profile

Mercury is a naturally occurring chemical element that is persistent, bioaccumulative and toxic at very low levels to human health and in aquatic and terrestrial ecosystems. It is found in three general forms: (1) pure mercury (a heavy metal), also known as “elemental mercury” or “metallic mercury”; (2) inorganic mercury compounds; and (3) organic mercury compounds.

Mercury and its compounds (hereinafter collectively referred to as “mercury”) are part of a global cycle and contribute to the formation of more harmful forms of mercury. Some micro-organisms and natural processes change mercury from one form to another. Methyl mercury, a very harmful organic substance, is of particular concern since it can build up in living organisms through their surrounding environments as it moves up the food chain. For instance, methyl mercury can build up in many edible fish (freshwater and saltwater) and marine mammals, to levels that are many times greater than those in the surrounding waters.

The primary route of human exposure to mercury is by consumption of fish or piscivorous (fish-eating) mammals with heightened levels of methyl mercury. There is particular concern for subsistence fishers who eat large quantities of fish as part of their traditional lifestyles. (see footnote 1) Human exposure to mercury can cause brain, nerve, kidney, lung or cardiovascular damage, or — in extreme cases — coma or death. Exposure to even low levels of methyl mercury can cause degenerative effects with respect to brain development, particularly in foetuses and children. Further, exposure to methyl mercury while in the womb may cause developmental difficulties in children such as reduction in intelligence quotient scores, delays in walking and talking, lack of coordination, blindness and seizures. (see footnote 2)

Use and emissions profile

Mercury has many useful properties that have led to its use in a variety of different products. (see footnote 3) For example, it forms alloys with other metals, conducts electricity and expands in response to changes in pressure and temperature. While most Canadian manufacturers no longer use mercury, there are still many products imported into the Canadian marketplace that contain it, including lamps, batteries, dental amalgam, thermostats, switches, relays, thermometers, other measuring devices and tire-balancing products. In 2008, an estimated 8 100 kg of mercury entered the Canadian marketplace in products, with more than half (4 700 kg) contained in dental amalgam, the use of which is subject to the pollution prevention provisions of the Canadian Environmental Protection Act, 1999 (CEPA 1999 or the “Act”); sizable amounts of mercury were also used in lamps, thermostats, switches, relays and batteries. (see footnote 4) (see footnote 5)

Mercury is released as a result of human activities such as metal mining, base metal smelting, the combustion of coal, and product use and disposal. Global emissions were estimated to be more than 5 000 000 kg in 2006, with deposition in Canada estimated to be roughly 156 000 kg. (see footnote 6) Canadian mercury emissions have already been reduced by roughly 90% since the 1970s through aggressive action to curb industrial emissions. However, more than 95% of the anthropogenic (human-made) mercury pollution deposited in Canada every year arrives from foreign emissions, which travel by air and are deposited in Canada’s soil and water. While emissions have declined in Canada over time, these reductions have not been reflected in lower environmental concentrations due to the persistent nature of mercury and increased industrialization in other countries.

Mercury levels found in the Arctic are of great concern, as they have increased two to three times over the past century in Canada’s Arctic lakes. By means of a global cycle, mercury tends to accumulate in polar regions, and the Arctic acts as a sink for mercury emitted throughout the entire northern hemisphere. In fact, the Canadian interdepartmental Northern Contaminants Program indicates that mercury levels have increased two to three times over the last quarter century in some Arctic marine birds and mammals. (see footnote 7) Thus, inhabitants of Northern Canada experience the highest risk of elevated mercury exposure because of traditional diets that consist of large quantities of fish and fish-eating mammals.

Profile of industry stakeholders

The Regulations will potentially impact some subsectors within Canada’s manufacturing sector, including those that use inputs containing mercury within products, most notably, the electric lighting equipment manufacturing subsector and the sign manufacturing subsector.

Prior to 2011, two facilities within the electric lighting equipment manufacturing subsector (364 establishments) manufactured fluorescent lamps containing mercury. However, the domestic manufacturing of lamps containing mercury declined following the closure of one of these facilities in Ontario in 2011. The remaining firm is a large multinational corporation with operations in Quebec. Production of lamps containing mercury is export-oriented, with an estimated 85% of production shipped abroad. About 90% of these exports are shipped to the United States. Regarding imports into Canada, 50% are from China and 31% are from the United States, with the remaining 19% coming from other countries such as Mexico, Germany and Japan. (see footnote 8)

The production of cold cathode tubing for signage or cove lighting (i.e. neon signs) in Canada is categorized within the larger sign manufacturing subsector. The neon sign subsector consists of 1 826 establishments throughout Canada, with 57% of these establishments located in Ontario and Quebec. These firms are predominantly micro-sized businesses (1–4 employees), with 54% employing less than five workers. (see footnote 9) It is estimated that 600 of these establishments produce neon signs that contain mercury. In 2008, neon sign manufacturers had estimated sales of $19 million, producing over 300 000 metres of output, with production solely for the domestic market. (see footnote 10)

In general, products containing mercury are imported as final goods or as intermediate goods (inputs) to be incorporated at various stages into final goods. For example, lamps are used in automobiles and liquid crystal display (LCD) screens; batteries containing mercury are used in watches, toothbrushes, hearing aids and calculators; and switches and relays are used in equipment and appliances such as computers, laboratory equipment, sump pumps and heating equipment. In most cases, it is not possible to track the sale or use of inputs to individual firms, making it difficult to compile detailed information pertaining to manufacturers.

Actions in other jurisdictions

In addition to a federal ban in the United States on mercury contained in paints and batteries, 45 states, including large states such as California, Illinois and New York, have regulations in place, the requirements of which range from mandatory product labelling, to the control of the sale and use of products containing mercury, to the establishment of disposal bans as well as education and collection programs.

In the European Union (E.U.), there are prohibitions and controls concerning a wide variety of products containing mercury, including electrical equipment, batteries, vehicles, thermometers and certain measuring devices (e.g. manometers and barometers). Several governments of Scandinavian countries have instituted legislation addressing products containing mercury that exceeds the requirements of current E.U. legislation. For example, the Government of Norway has a general prohibition targeting the production, import, export, sale and use of such products, while the governments of Denmark and the Netherlands have prohibited the import, export and sale of these products. (see footnote 11)

Issues

To date, the Government of Canada (“Canada”) has used numerous federal statutes to identify and manage most large industrial sources of mercury pollution. (see footnote 12) This legislative framework controls numerous industrial processes and aspects of mercury production, use, storage, transport and disposal. The framework includes the use of regulations, notices requiring the preparation and implementation of pollution prevention plans, and Canada-wide standards for waste incineration, base metal smelting and coal-fired electric power generation.

It is estimated that, in 2010, releases of mercury to air attributable to the use and end-of-life disposal of products were approximately 1 500 kg, representing close to one third of Canada’s total mercury emissions to air that year. (see footnote 13) Releases of mercury can occur at any stage of a product’s life cycle, including manufacturing, use, recycling and disposal. For example, mercury can be released when products containing this substance are broken at home or in the workplace, or as they are being transported to or disposed of in landfill sites.

Regulatory action regarding products will reduce Canada’s remaining mercury emissions. Without regulations, it is expected that products containing unregulated quantities of mercury will continue to enter the Canadian marketplace in significant quantities; consequently, it is projected that Canada’s product-based emissions will not decrease considerably in the absence of risk management.

Objective

The objective of the Products Containing Mercury Regulations (published in the Canada Gazette, Part I, under the title Regulations Respecting Products Containing Certain Substances Listed in Schedule 1 to the Canadian Environmental Protection Act, 1999) [the “Regulations”] is to protect human health and the environment by reducing releases of mercury from products used in Canada to the lowest level that is technically and economically feasible.

Description

Design

At the time of publication of the proposed Regulations on February 26, 2011, in the Canada Gazette, Part I, the regulatory provisions were designed to allow for the possibility of controlling products containing other substances listed in Schedule 1 to CEPA 1999, in addition to mercury. As published in the Canada Gazette, Part II, the Regulations will apply exclusively to products containing mercury or any of its compounds. The Regulations have been renamed and rewritten in order to reflect this modification.

Application

The Regulations apply to any product that contains mercury. They do not apply to waste from products, to products intended to be recycled that are at the end of their useful life, or to products for which the risk from mercury in these products is being managed by other federal regulations or another federal department. These latter products include food, drugs, natural health products, cosmetics, veterinary biologics, surface coating material, pest control products, feeds, fertilizers, and ammunition and explosives regulated under the Explosives Act or under the direction or control of the Minister of National Defence. The Regulations also do not apply to ores, concentrates or by-products of metallurgic operations, as it is assumed that mercury — while it may be naturally occurring — is not deliberately added to these products.

The proposed Regulations did not apply to the “incidental presence” of mercury in products. In the final Regulations, this language has been replaced by numerical thresholds, or “maximum concentrations,” at or below which products will be considered to be “mercury-free.” Specifically, the Regulations do not apply to products, other than batteries, that have a mercury concentration of less than or equal to 0.1% by weight in homogeneous materials. Also, the Regulations do not apply to batteries that have a mercury concentration of less than or equal to 0.0005% by weight in homogeneous materials (this maximum concentration does not apply to button cell batteries until January 1, 2016). These maximum concentrations are consistent with the two following E.U. directives: (1) the directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment (also known as the Restriction of Hazardous Substances Directive); and (2) the Directive on batteries and accumulators and waste batteries and accumulators (also known as the Battery Directive). From January 1, 2016, until December 31, 2019, the Regulations also do not apply to any button cell battery that is incorporated into a medical device intended to remain in the body for at least 30 consecutive days.

Finally, the Regulations do not apply to any component of an on-road vehicle that is of the 2016 model year or of a previous year, in accordance with the On-Road Vehicle and Engine Emission Regulations made under CEPA 1999.

Prohibition, exemptions and permits

The regulatory requirements will prohibit the manufacture and import of all products containing mercury, with the exception of the exempted products listed in the schedule to the Regulations. Exemptions were considered in circumstances where there are no technically or economically feasible alternatives, such as in the case of medical and research applications and dental amalgam; the product is prohibited under other regulatory instrument; the benefit of the product significantly outweighs its potential risks to the environment and human health.

In some cases, exemptions were provided to certain products containing mercury, such as lamps, to align with existing measures in the E.U. and in certain states in the United States, in order to prevent significant administrative costs and barriers to trade that could otherwise be faced by Canadian importers and manufacturers.

To the extent possible, the exempted products have been assigned a maximum total quantity of mercury allowed to be contained in the respective product. In the case of lamps, the Regulations will limit the amount of mercury contained in fluorescent and other types of lamps, rather than prohibit them.

Exempted products listed in the schedule to the Regulations may be subject to reviews that will allow for assessments of the availability of alternatives.

It is expected that this approach will reduce the amount of mercury emissions from lamps while providing consumer choice as the market transitions to adjust to Natural Resource Canada’s minimum energy performance standards for incandescent lamps. Currently, mercury-free alternatives such as light-emitting diode and halogen lamps are more costly than fluorescent lamps, and they are not suitable for all applications. However, as these technologies evolve, they are becoming less costly and new applications are being developed.

The permitting process established in the Regulations could be used to authorize the controlled manufacture or import of particular products containing mercury. Permits will only be issued in accordance with the regulatory provisions concerning permits. The Minister of the Environment may only issue a permit if the applicant has established that, at the time of application, there is no technically or economically feasible alternative to or substitute for the product that both (i) achieves a similar result as would be achieved by using the product containing mercury; and (ii) has a less harmful effect on the environment or on human health than the product containing mercury. Permits are not intended to be used as a transitional measure for existing products for which mercury-free alternatives currently exist.

Labelling, testing and reporting

The Regulations contain labelling provisions that require products containing mercury to be accompanied by labels supplying important information to consumers, such as the presence of mercury in the product in question, safe handling procedures, recommended measures to be taken in case of accidental breakage, and options for disposal or recycling. The symbol “Hg” must also be indicated on certain specified products or on the external surface of products that have components containing mercury, for example display screens that have lamps containing mercury. No labelling is required for products manufactured for export, replacement parts, or certain products used in various controlled and professional settings. Lastly, no labelling is required for the products containing mercury mentioned above to which the Regulations do not apply.

Regulated parties do not have to test products in order to import or manufacture them; however, if tested by Environment Canada as part of its market surveillance activities, products must not exceed the applicable maximum total quantity of mercury indicated in the schedule to the Regulations. Testing conducted by Environment Canada to verify compliance with the Regulations must be carried out by an accredited laboratory.

The Regulations also require that reports be submitted to the Minister of the Environment in order to collect data regarding products containing mercury imported into or manufactured in Canada. This reporting requirement will be harmonized with the triennial reporting frequency in the United States under the Interstate Mercury Education and Reduction Clearinghouse. (see footnote 14)

Regulatory and non-regulatory options considered

1. Status quo

It is expected that, in the absence of risk management, significant quantities of products containing unregulated quantities of mercury will continue to enter the Canadian marketplace, and, as a result, it is projected that mercury emissions from products in Canada will not decrease considerably under the status quo. For instance, an increase in imports of lamps containing mercury was forecast given the phase out of incandescent lamps in Canada. The market for lamps containing mercury is estimated to expand from 2014 to 2016, as Natural Resources Canada implements strict energy efficiency requirements for lamps in 2014, and, accordingly, as incandescent lamps are phased out in favour of mercury-containing compact fluorescent and mercury-free light-emitting diode lamps, which are both superior to incandescent lamps in terms of energy efficiency. (see footnote 15) (see footnote 16) There is also a possibility that newly developed products containing mercury could enter the Canadian marketplace. A recent example is provided by the introduction of tire balancers in 2000, which contain a relatively high quantity of mercury. For the reasons mentioned above, the status quo was rejected.

2. Regulatory approach

A regulatory approach constitutes a comprehensive option for managing the uses and emissions of mercury in products in Canada. This approach could minimize releases to technically and economically feasible levels, from both domestically-produced and imported products; and it could reduce the number of products containing mercury that enter the waste stream. For these reasons, a regulatory approach encompassing all products, in the form of the Regulations, was selected as the primary instrument.

3. Pollution prevention plans (implemented via federal government notices)

Federal government notices and pollution prevention plans have been successfully applied to control releases from individual installations, such as base metal smelters, refineries and zinc plants, and to the recycling of switches containing mercury in automobiles. Waste from the use of dental amalgam has also been controlled through the publication of a notice published in the Canada Gazette, Part I, and the preparation and implementation of pollution prevention plans as a result of this notice. (see footnote 17) These tools are effective within individual sectors. Nevertheless, there are several importing sectors and many different imported products containing mercury. If all importers were required to submit declarations to conform to a notice’s requirement to prepare and implement a pollution prevention plan, then a large increase in administrative costs could be incurred by both importers and the federal government.

4. Voluntary tools

Voluntary initiatives, such as the Canada-wide standards for lamps containing mercury, have been successfully applied to achieve reductions in the quantity of mercury in domestically manufactured lamps. From 1990 to 2006, Canadian manufacturers reduced the average mercury quantity in lamps from 43 milligrams (mg) to 7.9 mg per lamp. However, controlling mercury used in products in Canada with voluntary tools is difficult due to the vast number of imported products which arrive each year. While the above reduction is significant, it does not prevent the import of lamps with higher mercury content levels which are not covered by the standards. Within the broader context of products containing mercury, it has been concluded that voluntary initiatives cannot address the problem of imported goods, which could result in free-riding issues and in the establishment of an uneven playing field for Canadian industry.

5. Extended producer responsibility

Extended producer responsibility could be used for collection at the end-of-life stage of the product life cycle and could contribute to reduced releases from incinerators and landfill sites. There is a large “reservoir” of mercury in products used in Canadian society with some of these products exiting each year into the waste stream. An extended producer responsibility initiative could serve as a complementary tool to address the issue of products containing mercury in homes and workplaces. Extended producer responsibility programs were not chosen as a primary instrument because they cannot be used to prevent mercury releases that occur throughout the entire product life cycle; they may not be economically efficient for products which are not used in large numbers; and they may not capture all of the products that enter the waste stream. Nonetheless, Environment Canada recognizes that extended producer responsibility represents a complementary tool that is important to consider with respect to the recycling of certain products containing mercury.

6. Code of practice

To address potential mercury releases to the environment from the disposal of mercury-containing lamps which are exempted under the Regulations, Environment Canada will develop a national code of practice to provide technical guidance for the environmentally sound management of these lamps at their end of life. Environment Canada will include targeted guidance on how to manage specific challenges in northern and remote communities where access to recycling and disposal facilities is limited. This will complement the regulatory approach that was selected as the primary instrument. This voluntary code of practice will be developed in consultation with government and non-governmental stakeholders, and will complement provincial, territorial and industry initiatives. A discussion paper on the elements of a code of practice was recently published. A proposed code of practice will be published for public comment in 2015.

Benefits and costs

Summary of benefits and costs

From 2015 to 2032, the Regulations are expected to reduce the use of mercury in products by about 41 000 kg. Releases of mercury from products to the environment are estimated to decrease by 21 000 kg, including over 4 100 fewer kg of mercury released to air. The discounted benefits of the Regulations over the 19-year time period in question — due to mercury air releases from products avoided — are valued at $18 million, while the total discounted costs of the Regulations are estimated to be roughly $9 million. These costs are broken down as follows: $5.5 million will be incurred by importers for the increased cost of mercury-free alternative products (these costs to importers are assumed to be partly passed on to consumers); $2.1 million will be incurred by the federal government for compliance promotion and enforcement; and $1.4 million will be incurred by importers and manufacturers as the result of incremental reporting requirements and learning activities related to the Regulations. Overall, the discounted net benefits of the Regulations are estimated to be $9 million.

Approach

To forecast the impact of the Regulations, a study was conducted for Environment Canada in order to project the use of mercury in products using trend analysis and input from industry stakeholders. (see footnote 18) Following publication of the proposed Regulations in the Canada Gazette, Part I, another study was carried out in order for Environment Canada and Natural Resources Canada to obtain refined historical data and future projections with respect to the sales of mercury-containing and mercury-free lamps. (see footnote 19) The incorporation of these data and projections from this latter study represents an important adjustment in the analysis that follows. Lastly, another important analytical adjustment adopted following publication of the proposed Regulations in the Canada Gazette, Part I, is the incorporation of monetized health benefits within the estimation of the net social benefits resulting from the final Regulations.

The projections described herein are based upon the estimated annual input of mercury in intermediate and final products, the estimated annual output of mercury from products in use, and the fate of mercury throughout each product’s unique life cycle. Releases from products were estimated by Environment Canada through the use of a mass balance model that estimated the flow of mercury associated with products from the manufacture or import stage of the product life cycle, through to use, storage, transport, disposal and recycling.

An analysis of the incremental impacts (benefits and costs) was conducted using baseline and regulatory scenarios. To the extent possible, benefits and costs are estimated, monetized and expressed in 2012 Canadian dollars. The analysis begins in 2014 (the present value base year) and ends in 2032, with 2015 being the first year of implementation of the Regulations, and it employs a 3% discount rate for subsequent years when figures are expressed in present value terms. When restricted by a lack of appropriate data or challenges in valuation, the impacts have been described in qualitative or quantitative terms.

Baseline scenario

The baseline scenario is built upon estimates of the uses of mercury in each product type. In cases where there are well-established mercury-free alternatives, the relative use of products containing mercury is not expected to increase, irrespective of any market expansion regarding that particular product type (e.g. thermostats and thermometers). On the other hand, for products that require mercury to function (e.g. fluorescent lamps), the use of this substance is expected to increase as the market for the respective product expands.

Under the baseline scenario, in the absence of the Regulations, the use of mercury in products per year is expected to remain relatively high, from a level of about 7 200 kg in 2014 to a level of about 4 500 kg in 2032. These projections may underestimate the quantity of mercury used in products as they preclude the introduction of new products containing mercury into the Canadian marketplace and assume that domestic and imported lamps will contain the same quantity of mercury.

Regulatory scenario

Under the regulatory scenario, the manufacture and import of products containing mercury are prohibited with certain exemptions identified in the schedule to the Regulations. The regulated scenario takes these exemptions into account to the greatest extent possible, including reduced mercury levels in lamps over the 19-year timeline. The introduction of mercury in products that are not exempted from the prohibition against manufacture and import is assumed to be completely eliminated in 2015, as the Regulations will come into force one year after the day on which they are registered.

An estimated reduction of about 41 000 kg of mercury used in products is expected over the first 18 years of implementation; this estimation represents a 40% reduction in comparison to the baseline scenario. In 2015, around 2 200 fewer kg of mercury are expected to enter the Canadian marketplace; this projected annual reduction is expected to initially increase, then decrease to around 2 150 fewer kg by 2032 (see Table 1).

Table 1: Estimated impact of the Regulations on mercury entering the Canadian marketplace in products (in kg)

Year Baseline Scenario Regulatory Scenario Annual Difference Cumulative Difference
2014 7 153 7 153 0 0
2015 7 239 5 057 2 182 2 182
2023 5 548 3 261 2 287 21 293
2032 4 548 2 398 2 150 40 907

Source: Environment Canada

Benefits
Release reductions

The cumulative release reductions attributable to the Regulations are estimated to be approximately 21 000 kg, a decrease of 20% relative to the baseline scenario. In 2015, the estimated release reduction is 89 kg; this annual reduction is expected to increase to 1 460 kg by 2032, as the existing stock of products containing mercury will gradually be retired (see Table 2). The sum of avoided releases (21 166 kg) can be broken down between releases to land (80% or 16 882 kg), air (19% or 4 102 kg) and water (1% or 182 kg).

Table 2: Estimated impact of the Regulations on releases of mercury to the environment from products (in kg)

Year Baseline Scenario Regulatory Scenario Annual Difference Cumulative Difference
2014 6 885 6 885 0 0
2015 6 865 6 776 89 89
2023 5 837 4 502 1 335 8 520
2032 4 895 3 435 1 460 21 166

Source: Environment Canada

Mercury emitted to air can cycle through the atmosphere and deposit in aquatic and terrestrial ecosystems, with harmful impacts upon environmental quality. The Regulations are expected to reduce the annual release of mercury from products to air by 2% (31 kg) in 2015 and by 32% (352 kg) in 2032. The cumulative, estimated reductions to air will be 4 102 kg, representing a reduction of 19% compared to the baseline scenario (see Table 3). (see footnote 20)

Table 3: Estimated impact of the Regulations on releases of mercury to air from products (in kg)

Year Baseline Scenario Regulatory Scenario Annual Difference Cumulative Difference
2014 1 289 1 289 0 0
2015 1 299 1 268 31 31
2023 1 168 938 230 1 447
2032 1 096 744 352 4 102

Source: Environment Canada

Environmental benefits

The environmental benefits associated with the Regulations are discussed qualitatively as the parameters of interest have yet to be studied and quantified in a manner that is suitable for a cost-benefit analysis (e.g. “exposure-response” functions need to be further investigated). In qualitative terms, the Regulations will result in some benefits for Canadian wildlife and ecosystems due to decreases in the frequency or intensity of deposits or releases, as mercury is known to impair reproduction potential in some wild populations of fish and birds and to have neurological effects in fish-eating animals. Some of these benefits will be realized internationally as roughly two-thirds of Canada’s mercury emissions to air deposit internationally.

Health benefits

Mercury poses a host of human health risks, both in its elemental form and in more toxic forms such as methyl mercury. Primary sources of exposure to methyl mercury include diet, especially if it includes fish. Methyl mercury is particularly damaging to the development of infants and young children, who are especially vulnerable given that their nervous systems are still developing. Other potential health impacts being studied include links between exposure to methyl mercury from fish and increased incidence of cardiovascular disease. Studies suggest that large economic benefits can be realized by reducing mercury pollution. For instance, Rice and Hammitt (2005) estimate the value of health benefits from proposed limits on mercury emissions from U.S. power plants. (see footnote 21) Assuming that there is no lower threshold with respect to the negative impacts of mercury on brain development, these authors estimate benefits of $10,000 to $11,000 per kg of emissions avoided (2000 U.S. dollars). If a non-zero impact threshold is assumed, then Rice and Hammitt estimate benefits to be between $3,900 to $4,500 per kg of mercury emissions avoided.

More recently, Spadaro and Rabl (2008) estimate the impacts of global mercury emissions on brain development, and they obtain a much lower value of health benefits per kilogram of mercury emissions avoided because of their global focus. (see footnote 22) Yet, when applying their methodology to U.S. data, these authors arrive at results that are nearly identical to the results of Rice and Hammitt (2005). Given the similar results of these two studies, and in the absence of primary Canadian research, the results from Rice and Hammitt are used in this analysis. (see footnote 23)

The lowest estimated value of health benefits from the Rice and Hammitt (2005) of US$3,900 per kg of emissions avoided is selected for the analysis. Adjusting the value of $3,900 per kg in 2000 U.S. dollars gives a value of approximately $6,110 per kg in 2012 Canadian dollars. The lower-end value is adopted here due to a higher degree of uncertainty in the higher-end values. In addition, mercury emissions from facilities in the U.S. have much higher potential for population exposure in the U.S., since there is a large difference between the sizes of the Canadian and American populations. While the per capita impacts might be similar between Canada and the U.S., the total population health impacts are driven by the size of the exposed population. Therefore, it is reasonable to expect Canadian health impact estimates to be closer to the lower end of the estimates concerning the American population.

It is important to note that a monetized value for the estimated reductions in mercury emissions is only being applied here for the avoided emissions to air. Approximately 19% of the total environmental releases avoided under the Regulations would be direct releases to air. Most of the avoided releases would be releases to soil (at landfill sites), with a relatively insignificant amount of the avoided releases being direct releases to water. Mercury deposited to landfill sites is not monetized in this analysis because there is a lack of systematic evidence and a high degree of uncertainty regarding the long-term behaviour and fate of mercury in landfill sites.

Applying the simplifying assumptions mentioned above to measure the benefits of the 4 102 kg of mercury air emissions expected to be avoided in the regulatory scenario yields a present value of $18 million. (see footnote 24)

Finally, given that human exposure to mercury can occur in the home or workplace as a result of products being misused or broken, the Regulations will also contribute to the health and safety of Canadians by prohibiting or limiting the presence of mercury in products.

Costs
Cost to manufacturers, importers and consumers

The Regulations will prohibit the manufacturing of most products containing mercury in Canada and assign maximum quantities of mercury allowed to be contained in lamps and neon signs. No additional investment in capital or reformulation is expected to be incurred by domestic manufacturers of these products in order to meet the regulatory requirements. The lamp manufacturing sector is not expected to be burdened by the mercury content limits, as this sector has voluntarily reduced the average mercury content per lamp through the use of more efficient manufacturing processes and currently exports to jurisdictions with similarly strict content limits (e.g. the E.U. and some states in the United States). In terms of neon signs, the maximum total quantity of mercury indicated in the schedule to the Regulations was established following consultation with the Canadian industry association representing manufacturers and retailers of neon signs. The purpose of specifying this maximum total quantity of mercury is to provide regulatory certainty to domestic neon sign manufacturers; that is, their current practices are not anticipated to be affected. Hence, no incremental costs are estimated to be incurred by manufacturers as a consequence of Environment Canada identifying the maximum total quantity of mercury allowed to be contained in neon signs.

Importers of products containing mercury are not expected to be significantly impacted by the Regulations. In most cases, these importers are expected to be able to substitute mercury-free products that are technically feasible and comparably priced for products containing mercury, including the substitution of mercury-free light-emitting diode lamps for analogous mercury-containing compact fluorescent lamps. In this analysis, two mercury-free alternatives are identified as being relatively more expensive than their counterparts containing mercury, namely, mercury-free digital thermometers and button cell batteries. In addition to the importers of these two alternatives, the Regulations will apply as well to the Canadian manufacturers that import mercury-free thermometers and batteries for integration into the production of final goods (e.g. domestic firms that produce wristwatches, toys, hearing aids or calculators with button cell batteries). Altogether, the incremental costs incurred by importers and domestic manufacturers, as the result of relative increases in the prices of goods allowed to be imported, are assumed to be partly passed on to consumers.

Mercury-free digital thermometers are assumed to cost 25% more than thermometers containing mercury. (see footnote 25) The aggregate incremental cost for digital thermometers is estimated to be $1.7 million over 19 years. (see footnote 26) This cost is a maximum value, since it will be partially balanced by the improved performance of digital thermometers (higher accuracy and less time to take a reading), and consumers could always choose to purchase liquid thermometers that are less expensive than digital thermometers but offer inferior performance.

In addition, mercury-free button cell batteries are assumed to be 10% more expensive than button cell batteries containing mercury until the manufacture and import of those with mercury is prohibited in Canada on January 1, 2016. (see footnote 27) The implicit price differential between mercury-free and mercury-containing button cell batteries is further assumed to be reduced to negligible amounts by 2019 due to market expansion, increased competition and economies of scale. This analysis forecasts that the aggregate incremental cost for mercury-free varieties of button cell batteries will be roughly $3.8 million over 19 years. (see footnote 28)

Administrative costs

The requirements of the Regulations will place some incremental administrative burden on domestic firms that already conduct certain required activities as part of their normal business practices (e.g. labelling and record keeping). Specifically, firms manufacturing or importing products that will be allowed (by permit or exemption) to contain mercury will incur aggregate administrative costs. These costs are estimated to be close to $1.4 million and will result from incremental reporting requirements as well as learning activities, since regulated firms will have to engage in additional learning to become familiar with the regulatory provisions. Also, firms that will have to make adjustments to their current labelling practices due to the Regulations will incur incremental administrative costs. However, given that labelling practices in Canada will be more aligned with those in the E.U. and the United States, these mandatory adjustments will be minor in nature and the resulting costs are assumed to be part of the normal operating expenditures of regulated parties.

Cost to government

The federal government will incur incremental costs related to enforcement and compliance promotion. Regarding enforcement, in 2014, one-time amounts of approximately $53,000 and $50,000 will be required, respectively, for the training of enforcement officers and to meet information management requirements. As of 2015, the annual enforcement costs are estimated to be about $130,000, broken down as follows: $84,500 for inspections (including operations and maintenance, transportation, and sampling costs); $19,500 for investigations; $5,500 for measures to deal with alleged contraventions (including warnings, environmental protection compliance orders and injunctions); and $20,500 for prosecutions. Compliance promotion activities will require a budget of about $79,000 in 2014. These costs are projected to decrease steadily during the first four years of implementation (2015–2018) and to stabilize at an estimated level of $6,500 for five years (2019–2023). It is assumed that compliance promotion activities associated with the Regulations will no longer be required after 2023. In total, over the 19-year time frame used for this analysis, the total discounted cost for the federal government related to enforcement and compliance promotion is expected to be approximately $2.1 million.

Competitiveness

The Regulations are not expected to harm the economic competitiveness of lamp manufacturing in Canada, within the domestic market, as manufactured and imported lamps will be subject to the same maximum quantities of mercury allowed to be contained in these products. Further, products that are manufactured in Canada for export will only be subject to the labelling requirements of the importing country.

Conclusion

The discounted monetized costs and benefits as well as the quantitative and qualitative benefits associated with the Regulations are summarized in Table 4.

Table 4: Cost-benefit statement (2014–2032)

A. Quantified and monetized costs (2012 Canadian dollars; present value base year of 2014; 3% discount rate) Amount
Estimated increased cost of mercury-free thermometers to importers and consumers $1.7 million
Estimated increased cost of mercury-free button cell batteries to importers and consumers $3.8 million
Estimated incremental cost to Government $2.1 million
Estimated incremental administrative costs to importers and manufacturers $1.4 million
Total estimated monetized costs $9 million
B. Quantified benefits (cumulative) Amount
Reduced input of mercury used in products 40 907 kg
Reduction in mercury releases from products to the environment 21 166 kg
Reduction in mercury releases from products to air 4 102 kg
C. Quantified and monetized benefits (2012 Canadian dollars; present value base year of 2014; 3% discount rate)  
Estimated monetized benefits to human health (avoided health issues) due to reduction in mercury releases to air from products $18 million
Estimated monetized net benefits due to the Regulations $9 million
D. Qualitative benefits Description
Environmental benefits It is expected that there will be benefits for wildlife and ecosystems commensurate with the reduction of mercury in products in Canada. Mercury impairs reproduction potential in some species of fish and birds, and has neurological impacts on fish-eating animals.
Health benefits for Canadians In addition to damage to the central nervous system, human exposure to mercury is known to cause damage to the lungs, nerves and kidneys. The Regulations will limit mercury exposure from products through reduced releases of this substance to the environment.
Level playing field concerning lamp manufacturing in Canada Domestically manufactured and imported lamps will be subject to the same maximum quantities of mercury.

“One-for-One” Rule

In 2012, the federal government implemented the “One-for-One” Rule in order to reduce administrative burden incurred by businesses that operate in Canada and engage in commercial activities related to the supply of services or property (which includes goods). Under the Rule, regulatory changes that impose new administrative burden costs (“INs”) on business must be counterbalanced or offset, within two years, with an equivalent reduction in administrative burden costs (“OUTs”) from the current stock of regulations. In addition, federal government departments are required to remove an existing regulation from their current portfolio of regulations, within two years, when an entirely new regulation imposes new administrative burden costs on business.

The “One-for-One” Rule applies to the Regulations because they are a new Environment Canada regulatory initiative that will impose incremental administrative burden costs, or “INs”, on business. It is estimated that importers and manufacturers of products containing mercury will incur new annualized costs in the order of $91,500, or $25 per stakeholder, due to incremental reporting requirements and learning activities (2012 Canadian dollars; present value base year of 2012; 7% discount rate; 10-year analytical time frame).

In the context of the “One-for-One” Rule, the proposed regulatory provisions were reviewed in order to determine if reductions could be achieved in the level of administrative costs anticipated to be incurred by firms in the regulated community, while maintaining the same level of expected protection to human health and the environment. The decision was made to remove the provisions controlling the sale of products containing mercury from the final Regulations. Retailers are thus no longer directly targeted and the number of regulated parties is greatly reduced. Nevertheless, the Regulations still control the entry of products containing mercury into the Canadian marketplace by means of the provisions regulating the import and manufacture of these products. Lastly, while the proposed Regulations included a proposed reporting frequency of once per year, the regulated reporting frequency in the final Regulations will be harmonized, as of the 2016 calendar year, with the existing three-year cycle in states participating in the Interstate Mercury Education and Reduction Clearinghouse.

Small business lens

In 2012, the federal government also implemented the “small business lens.” The purpose of this lens is to drive better analysis of small business realities and consultation at the earliest stages of regulatory design, and to consider risk-based alternate compliance approaches that minimize costs for small businesses operating in Canada. In the case of the Regulations, the small business lens does not apply because the nationwide annualized costs resulting from the regulatory provisions are estimated to be below the threshold of $1 million in nationwide annualized costs, which triggers the lens. (see footnote 29)

In addition, the small business lens does not apply in this case since the costs estimated to be incurred will not be disproportionally high for small businesses within the regulated community, including the neon sign manufacturing sector in which most manufacturers are small businesses. In an effort to minimize the impact of the Regulations on these small businesses, the maximum total quantity of mercury allowed to be contained in neon signs was determined following consultation sessions that occurred subsequent to the publication of the proposed Regulations in the Canada Gazette, Part I, with the industry association representing manufacturers and retailers of neon signs in Canada. This maximum quantity of mercury is set out in the schedule to the Regulations, having been recommended to Environment Canada by the industry association during these consultation sessions based on current standard operating procedures. As a result, it was concluded that the cost of complying with this limit could be included in normal operating costs, and it is assumed that no incremental cost is incurred by businesses in the neon sign manufacturing sector to meet the maximum quantity of mercury authorized in neon signs.

Consultation

Consultation prior to publication of the proposed Regulations in the Canada Gazette, Part I

Two rounds of national consultations were held with stakeholders from industry, government and environmental non-governmental organizations in 2007 and 2008. (see footnote 30) In general, these groups were supportive of risk management measures for some or all products containing mercury. A targeted mail-out was conducted in 2009 to remaining stakeholders. In addition, Environment Canada consulted and shared information with the U.S. Environmental Protection Agency through various forums.

Consultation sessions

In 2008, Environment Canada hosted multi-party consultation sessions in Toronto, Ontario, and Vancouver, British Columbia, to discuss tools and instruments for prohibiting or limiting mercury use in products, controlling imports and exports, and setting labelling requirements. A consultation document was sent to over 500 stakeholders for comments. Those interested parties that attended the consultation sessions or submitted written comments included stakeholders from industry, industry associations, government departments, and environmental and health organizations. A total of 33 participants representing various stakeholder groups took part in these sessions.

During the sessions, Environment Canada received comments on the following topics:

Prohibition of products containing mercury

While participants generally endorsed the management of some or all products containing mercury in Canada, they questioned whether life cycle analyses supported a broad prohibition. It was suggested that lamps containing mercury, for example, could continue to be managed using a voluntary approach, given the success of the domestic industry in reducing the quantity of mercury in lamps.

Environment Canada argued that life cycle analyses demonstrate that releases may occur during any stage of a product’s life cycle, and indicated that emissions to air from products were in the order of 1 500 kg per year. Prohibition is thus considered to be an efficient means to limit releases from new products. In terms of lamps, Environment Canada recognized that, while commendable progress has been made by Canadian manufacturers in voluntarily achieving the targets under the Canada-wide standards for lamps containing mercury, there is a need to achieve reduced mercury levels in all lamps sold in Canada, including imports.

Some participants raised the possibility that the use of products containing mercury, particularly products other than dental amalgam and compact fluorescent lamps, would continue to decline and disappear over time without the need for a prohibition.

Environment Canada’s position is that the relatively low price of mercury and its increasing surplus in the marketplace, coupled with its useful technical properties, provide economic incentives to firms to preserve their current uses of this toxic substance and potentially use it in new products.

Exemptions

The opinions of stakeholders differed on whether specific products should be exempt from the prohibition provisions of the Regulations. Some participants felt no exemptions were needed, while others felt that exemptions were appropriate for dental amalgam and lamps containing mercury, as long as a life cycle approach was adopted and end-of-life management practices (with respect to the product life cycle) were introduced. Other participants felt that a phase-out period for certain products would be useful and that end-of-life management practices should be an interim strategy until all products containing mercury are eliminated. Finally, importers of products that contain mercury in inputs requested exemptions, if mercury-free alternatives were deemed to not be viable. Also, for final goods manufactured before the coming into force of the Regulations, exemptions were requested for the sale and labelling of inputs containing mercury to be integrated as components of those final goods.

Environment Canada responded that exemptions would be available when a lack of viable alternatives exists and the need for continued use of these products in Canada can be demonstrated. The overall approach would include developing end-of-life management practices for any exempted product. Exemptions would also be subject to periodic review, based on innovations in the research and development of alternatives. The Regulations would also exempt some inputs containing mercury integrated into final goods manufactured before the Regulations come into force.

Some stakeholders expressed that separate maximum total quantities of mercury may be required for various lamp types, if lamps containing mercury are to be exempted from the prohibition provisions of the Regulations.

Environment Canada recognized that the same maximum quantity of mercury would not be applicable for all lamps requiring mercury as an input and, therefore, agreed to explore the possibility of mandating separate maximum quantities of mercury. This point has been addressed in the final Regulations. The maximum total quantities of mercury authorized to be contained in various lamp types are listed in the schedule to the Regulations.

Labelling

In terms of labelling, participants from industry sectors were focused on the specific nature of the labelling requirements. The topics identified for consideration and discussion included the need to minimize text on labels, given limited amounts of space; the requirement for easy-to-read labels that provide mercury content information; and the need for information to appear on labels pertaining to the proper disposal and health risks of products, particularly for sensitive populations.

Environment Canada responded that labelling requirements would take practicality and ease of reading into account. When product size and labelling requirements are issues to be considered, Environment Canada will work, to the extent possible, with the relevant stakeholders and other federal government departments such as Health Canada and Natural Resources Canada.

Targeted mail-out

Prior to publication of the proposed Regulations in the Canada Gazette, Part I, Environment Canada conducted a targeted mail-out in 2009 to additional stakeholders who could potentially be impacted by the Regulations due to their use of inputs containing mercury such as button cell batteries. During this time, Environment Canada was not made aware of any manufacturers or subsectors within the manufacturing sector that would be significantly burdened as the result of having to incorporate mercury-free alternatives into final goods.

Consultation following publication of the proposed Regulations on February 26, 2011 (published in the Canada Gazette, Part I, under the title Regulations Respecting Products Containing Certain Substances Listed in Schedule 1 to the Canadian Environmental Protection Act, 1999)

On February 26, 2011, the proposed Regulations were published in the Canada Gazette, Part I, for a public comment period of 75 days. Stakeholders were identified and advised of this comment period through regular mail and email. Further, a press release and supporting information were published on Environment Canada’s Web site on February 28, 2011, in order to widely disseminate information to interested parties. (see footnote 31) Shortly thereafter, on March 2, 2011, pursuant to subsection 93(3) of CEPA 1999, Environment Canada and Health Canada informed the governments of the provinces and territories of the publication of the proposed Regulations through the National Advisory Committee of CEPA 1999 (CEPA NAC). Environment Canada also made a presentation during a CEPA NAC meeting in June 2011. No comments concerning the Regulations were received from CEPA NAC members.

Since the requirements of the Regulations could potentially have implications for international trade practices, Environment Canada sent a notification to the World Trade Organization’s Committee on Technical Barriers to Trade in March 2011. A posting was made available to the members of the Committee on Technical Barriers to Trade concerning the publication of the Regulations in the Canada Gazette, Part I, and the associated public comment period. No comments were received through this process.

Two notices of objection with respect to the proposed Regulations were received from stakeholders requesting the establishment of a board of review in accordance with section 333 of CEPA 1999. The two notices of objection and Canada’s complete responses to these notices are available on the CEPA Environmental Registry. (see footnote 32)

One non-governmental organization (NGO) submitted a notice of objection opposing the exemption for dental amalgam in the Regulations and requesting that a board of review be established to address this opposition. In a joint response to this NGO, the Minister of the Environment and the Minister of Health (the “ministers”) indicated that a board of review would not be established for various reasons. First, the notice of objection did not bring forth any new scientific data or information with respect to the nature and extent of the danger posed by mercury. Second, Health Canada had already concluded that mercury levels in the body from dental amalgam do not approach those recognized to cause illness, and that it is essential from a public health perspective that Canadians continue to have access to dental amalgam, which is a safe and cost-effective choice of dental restorative material. Finally, the ministers noted that mercury releases from dental amalgam waste continue to be managed under CEPA 1999 by means of pollution prevention plans prepared and implemented following the publication of a federal government pollution prevention notice on May 8, 2010. (see footnote 33)

The second notice of objection was submitted jointly by three Canadian industry associations representing businesses that manufacture and distribute a range of products. This submission requested the establishment of a board of review due to concerns expressed that the generic nature of the proposed Regulations was inappropriate and had not been the subject of adequate consultation. The Minister of the Environment responded to the industry associations stating that, at the time of the publication of the proposed Regulations in the Canada Gazette, Part I, mercury was the only substance targeted. Further, as stated in the Regulatory Impact Analysis Statement (RIAS) for the proposed Regulations, any addition of a substance would have been done in accordance with the regulatory process, including public consultation requirements, as set out in CEPA 1999, and would have required amendments to the Regulations, as well as the development of a separate RIAS and publication in the Canada Gazette, Part I. Nevertheless, the Minister of the Environment indicated that, instead of the final Regulations maintaining the proposed generic framework of applying to products containing any substance listed in Schedule 1 to CEPA 1999, the Regulations will, subject to the approval of the Governor in Council, deal explicitly and exclusively with products containing mercury. Thus, the Minister of the Environment did not establish a board of review in this case, given that Environment Canada had addressed the concerns expressed by these stakeholders by renaming the Regulations, targeting only mercury and removing from the regulatory text any provision relating to a generic application for controlling products containing identified substances other than mercury listed in Schedule 1.

The public comment period of 75 days ended on May 12, 2011. During this consultation period, over 70 submissions were received regarding the proposed Regulations from firms, councils, industry associations, environmental and health organizations, government departments, and the public. Comments received touched on many elements of the proposed Regulations. Environment Canada and Health Canada committed to summarizing the feedback and publishing an official response. In November 2011, these two federal government departments published a document providing a comprehensive response to the comments received during the public comment period. (see footnote 34) Following this publication, Environment Canada consulted on a regular basis with those stakeholders that provided comments to explain how the federal government was planning to address their concerns and suggestions, as well as to give them an opportunity to provide additional feedback.

A summary of the comments received following publication of the proposed Regulations in the Canada Gazette, Part I, and how they are addressed in the final Regulations, is presented below.

General comments

Comment: There is a need to control mercury in products, but extending the Regulations beyond mercury would be inappropriate. The Regulations should be rewritten to make them applicable to mercury only and to remove any wording regarding a generic application to products containing other substances listed in Schedule 1 to CEPA 1999.

Response: The Regulations did not maintain their proposed generic framework. The final Regulations focus exclusively on products containing mercury and have been renamed and rewritten in order to reflect this decision.

Comment: Existing laws and regulations in the E.U. and the United States should be taken into account to avoid creating potential barriers to trade through the implementation of Canadian regulations that are not aligned with these jurisdictions. In particular, harmonization with requirements in states participating in the Interstate Mercury Education and Reduction Clearinghouse should be pursued. This approach would be consistent with commitments made under the Canada-United States Regulatory Cooperation Council.

Response: Canada’s approach to products containing mercury has been developed through a process of extensive consultations over a number of years. The Regulations involve a general prohibition, with some exemptions for essential products with no viable alternatives and specifications of the maximum total quantity of mercury to be contained in a given exempted product. Environment Canada has examined measures taken in other jurisdictions and has sought alignment where possible. Adjustments have been made to the final Regulations to further harmonize them with measures in the E.U. and the United States, where possible and practical (e.g. in terms of labelling, reporting and exemptions).

Comment: Several stakeholders mentioned that the Regulations should have a delayed entry into force in order to adopt a more gradual and phased approach.

Response: After considering the requests from stakeholders for a delayed entry into force, which ranged from six months to five years (with most requests being for one year), Environment Canada has decided that the final Regulations will come into force one year after the day on which they are registered.

Application

Comment: Clear policy coordination is required between different pieces of federal legislation governing products in order to avoid legislative overlap, duplication and confusion. For instance, since the Food and Drugs Act sets the authorized concentration of mercury in food, the Regulations should not apply to food such as fish and seafood. As another example, the Regulations should not apply to explosives already regulated by the Explosives Act.

Response: The federal government is committed to using the most cost-effective approaches to manage the risk posed by substances and is using its authority under CEPA 1999 to regulate toxic substances in products. However, some of these products may already be regulated under other legislation. Federal government departments have therefore been coordinating their activities in order to avoid duplication. For example, food, consumer paints and other surface coatings (including those applied to toys), and cosmetics have been excluded from the final Regulations, since they are covered under other existing legislation.

Comment: Coal and the combustion of coal in Canada should be targeted by the Regulations.

Response: The intent of the Regulations is to target products to which mercury is deliberately added, such as lamps, thermometers and other measuring devices. Environment Canada does not intend to regulate coal by means of these Regulations, as mercury is a naturally occurring substance found in trace amounts in coal (i.e. it is incidentally present in coal). When coal is combusted, this mercury can be released to the environment. Such releases are currently managed by provincial governments by means of the Canada-wide Standards for Mercury Emissions from Coal-fired Electric Power Generation Plants which were finalized in 2006. (see footnote 35) In addition, the Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity Regulations are expected to yield supplementary benefits in the form of reductions in mercury releases to air from the combustion of coal when old coal-fired electricity generating units close in order to comply with the regulatory requirements. (see footnote 36)

Comment: The term “incidentally present” should be clarified. The Regulations should not apply to products that are “mercury-free.” A “mercury-free” product should be defined as follows: a product with no addition of mercury and with a maximum concentration of mercury of 0.1% by weight. This definition is the one used in the E.U. Restriction of Hazardous Substances Directive. Test procedures cannot demonstrate the total absence of mercury, but this definition would indicate that such a product contains no intentional mercury addition.

Response: The Regulations will not apply to products for which mercury may be incidentally present or the risk from mercury is covered by other federal legislation; these products include food, paint, cosmetics, explosives, pest control products, feeds and fertilizers. In addition, a threshold, at or below which products will be considered to be “mercury-free” and the Regulations will not apply, is included in the regulatory text. This threshold is 0.1 % by weight in homogeneous materials for all products, except batteries for which the value is 0.0005% by weight in homogeneous materials. These values are consistent with the E.U. Restriction of Hazardous Substances Directive and Battery Directive. Lastly, the Regulations contain an exemption for button cell batteries containing mercury lasting until December 31, 2015. This temporary exemption aligns with phase-out dates in states participating in the Interstate Mercury Education and Reduction Clearinghouse. It provides additional time as well for the transition to mercury-free varieties of button cell batteries and for the extra cost of these batteries to decline.

Labelling, reporting and testing

Comment: Associations representing various sectors of Canadian industry and several multinational corporations provided observations to Environment Canada indicating that the labelling requirements in the proposed Regulations presented potential non-tariff barriers to trade. These stakeholders specified that the labelling requirements should be simplified so that labels are harmonized with the conditions in other jurisdictions, because the domestic requirements could force Canadian companies to set up unique product numbers, potentially impacting their capacity to manufacture or import products with common packaging in a shared international inventory. In particular, it was noted that the quantity of mercury in the product in question should be reported to Environment Canada, but should not be required to be identified on the product label. Also, it was mentioned that labelling should not be required for products manufactured for export. Finally, it was suggested that labelling should not be required for replacement parts manufactured or imported before the Regulations come into force.

Response: Environment Canada has addressed all of the concerns raised by Canadian industry regarding labelling through the following means: (1) conducting a thorough review of the labelling requirements in the E.U. and the United States for products containing mercury; and (2) modifying the Canadian labelling requirements in order to increase harmonization with other jurisdictions and to reduce the amount of compulsory information on labels in Canada. To illustrate, in order to align with labelling practices in the United States, the words “Caution” and “Mise en garde” have been removed from the required labelling information in the final Regulations. For a component containing mercury that is in a relatively large product, such as an automobile, added flexibility has been provided as to where the labelling information must be placed; for example, in a manual that accompanies the product. In addition, the obligation has been removed from the regulatory provisions to either specify on the label of a product the quantity of mercury it contains, or provide a statement on the label of a product that the quantity of mercury it contains is less than or equal to the maximum total quantity authorized in the product. Nevertheless, the label will need to indicate the presence of mercury, while the total quantity of mercury in a given product will need to be reported to Environment Canada, in accordance with the final regulatory provisions. Lastly, the labelling provisions have been modified such that they will not apply to products manufactured for export or to replacement parts.

Comment: Reporting under the proposed Regulations should be required less frequently. Instead of annual reports relating to the total quantities of mercury contained in products, a multi-year cycle would reduce the administrative burden costs imposed on industry. For example, a three-year cycle could be used for reporting and would align with the frequency of reporting in states participating in the Interstate Mercury Education and Reduction Clearinghouse. Also, reporting should not be required for replacement parts.

Response: Environment Canada will harmonize its regulated reporting frequency with the existing three-year cycle in states participating in the Interstate Mercury Education and Reduction Clearinghouse. Specifically, reports must be submitted on or before March 31 of the 2016 calendar year and every subsequent third calendar year. Finally, while the proposed Regulations targeted replacement parts in terms of reporting requirements, the final reporting provisions will not apply to replacement parts that contain mercury.

Comment: Why do only lamps require certification for compliance with respect to maximum quantities of mercury? Lamps should not require higher scrutiny than other products. Several industry stakeholders stated that the certification of lamps by a third party should not be required and they recommended removing the certification provision for lamps from the proposed Regulations. One not-for-profit, industry-led organization also noted that, as a result of certification requirements targeting Canadian importers and manufacturers of lamps, the costs of certified lamps would most likely be distinctively greater than the costs of the matching non-certified lamps manufactured and traded internationally. Differences in Canadian and world prices for lamps would generate potential non-tariff barriers to trade.

Response: Environment Canada has removed the requirement to obtain third-party certification of lamps containing mercury from the final regulatory provisions. If this policy had been adopted, significant administrative costs and barriers to trade would most likely have been faced by Canadian importers and manufacturers, and in all likelihood, only minor or negligible corresponding benefits would have been realized in addition to the benefits associated with regulated parties complying with the prohibitions and the required record-keeping and reporting activities, under the final Regulations.

Permits and exemptions

Comment: There should be service standards or timelines identified in the Regulations for the review of permit applications.

Response: Timelines relating to permit applications will not be included in the Regulations themselves. However, it is expected that, in most cases, Environment Canada will be in a position to render a decision concerning a duly completed permit application within a period of approximately 90 days, which is the same time period established for the permit renewal application process.

Comment: Exempted products should have expiry dates to encourage the phase out of all products containing mercury. Otherwise, by granting exemptions, there is no incentive to seek alternatives.

Response: There are end dates in the schedule to the Regulations for some exempted products when it is known that viable mercury-free alternatives are forthcoming (e.g. for button cell batteries). Advances in technology will be closely monitored by Environment Canada and amendments to the schedule will be made, as appropriate, to remove exempted products or lower the maximum total quantity of mercury allowed to be contained in certain products.

Comment: Stakeholders remarked that an exemption for a replacement part containing mercury would be necessary for any product that legally contained that part at the time of manufacture or import, not only for a product introduced into the Canadian marketplace prior to the coming into force of the Regulations.

Response: The proposed Regulations contained an exemption for any replacement part for a product if, prior to their coming into force, the product contained the part. After considering the comment received from stakeholders, Environment Canada has made modifications to the exemption for replacement parts. The final Regulations will exempt any replacement part if the product contained the part before the coming into force of the Regulations or if its manufacture or import was permitted under the Regulations at the time of its manufacture or import. Finally, in order to better define a “replacement part,” the schedule to the final Regulations provides the following description: Replacement part means a part that is required for a product to continue to function and for which there is no mercury-free alternative or product listed in the schedule that could serve as a direct substitute.

Comment: Several associations and councils commented that the proposed Regulations would establish regulatory requirements that are unique to Canada concerning the maximum total quantities of mercury allowed to be contained in exempted products, thereby creating potential barriers to trade. The interested parties stated that the proposed maximum quantities of mercury for certain products would not be harmonized with those in the United States, including those applying to button cell batteries, automobile headlamps and all other types of lamps.

Response: Environment Canada has addressed the concerns raised relating to the proposed maximum quantities of mercury for exempted products by relaxing (increasing) some of these limits. All of the maximum quantities of mercury published in the schedule to the final Regulations were finalized after in-depth consultations with the concerned associations and councils following publication of the document providing a comprehensive response to the comments received during the public comment period of 75 days. In late 2011 and throughout 2012, Environment Canada held numerous consultations with Health Canada and Industry Canada, as well as with the respective Canadian association or council representing the medical industry, domestic vehicle manufacturers, international automobile manufacturers, companies that manufacture, distribute and service electrical and electronics products, manufacturers and retailers of signs, consumers, and retailers. Environment Canada has met many of the requests from stakeholders, aligning the maximum quantities of mercury in the final Regulations with those established in the U.S., where possible.

Domestic and international coordination and cooperation

In January 2013, the drafting of a global, legally binding instrument on mercury was successfully concluded under the auspices of the United Nations Environment Programme, with over 140 nations agreeing to the treaty text of the new Minamata Convention on Mercury (the Minamata Convention). Canada supports this treaty text since it targets the reduction of major sources of global emissions of mercury that present risks to Canadians and their environment. (see footnote 37) The Minamata Convention also contains provisions to phase out the use of mercury in many existing products, as well as provisions to discourage the development of new products containing mercury. The Regulations will allow domestic actions to be taken regarding products containing mercury, including actions to meet most of the obligations related to products under the Minamata Convention.

Overall, the Regulations will complement Canada’s diverse policy and program initiatives relating to mercury by targeting its use in and release from products. Canada’s approach to managing the risks associated with mercury in products will also be broadly consistent with the approaches being implemented in the E.U. and in the United States by states such as California, Connecticut, Maine, Oregon and Vermont. The Regulations will thus serve as a critical instrument in the demonstration of Canada’s leadership and participation on the international stage, alongside other leading jurisdictions, concerning reductions of mercury in products.

Rationale

Mercury is a neurologically toxic substance that is persistent and present in the environment in sufficient quantity to threaten the health and environment of Canadians. While some of the mercury released to the Canadian environment is the result of domestic activity, the majority of it arrives from foreign sources, highlighting the global nature of mercury pollution. Canada’s ability to influence its international partners and to encourage emission reductions internationally will depend, in part, upon the integrity of its position and its ability to manage domestic sources of the release of mercury from products.

Over the past few decades, Canada has achieved significant reductions in mercury pollution from industrial sources. However, releases of mercury from products have not been addressed to date to a great extent, despite representing close to one-third of the total remaining releases of mercury to air in Canada. If no further action is taken, Canada is likely to face increased domestic use of products containing mercury and, hence, increased releases of this substance from products in the future.

To effectively realize a reduction of mercury releases from products relative to the status quo, a regulatory approach was chosen to prohibit (with several exemptions) the manufacture and import of products containing mercury. The Regulations will allow for the control of imported products that account for the vast majority of the use and release in Canada of mercury in products. Also, the Regulations will prevent future application of mercury in products, unless this use is deemed essential, and will signal to Canadians that every product available in Canada which requires mercury to operate contains the lowest level of this substance that is technically and economically feasible.

The Regulations will result in an estimated present value cost of up to $9 million incurred by importers, consumers and the federal government. Concurrently, there will be quantified reductions over the first 18 years of implementation (2015–2032), including about 41 000 fewer kg of mercury entering the marketplace and, consequently, 21 000 fewer kg of mercury being released to the environment. Compared to the baseline scenario, the present value benefit of mercury air emissions from products avoided under the regulatory scenario is expected to be around $18 million or twice as large as the present value cost of the Regulations. Hence, the net benefits of the Regulations are estimated to be $9 million in present value terms.

The Regulations were developed in consultation with stakeholders from industry, the provincial and territorial governments, environmental non-governmental organizations, and other federal government departments. The regulatory provisions are consistent with a variety of measures found in Europe and the United States, and enable Canada to contribute towards the international initiatives pertaining to mercury to which it is a party. Given that large quantities of mercury deposited in the Canadian environment arrive from foreign sources, continued actions by Canada to reduce mercury emissions, where appropriate, may encourage its international partners to take similar measures, which would generate additional benefits for Canadians.

Implementation, enforcement and service standards

Implementation

The Regulations will come into force one year after the day on which they are registered.

For the purpose of implementing the regulatory requirements, Environment Canada will undertake a number of compliance promotion activities. These activities will aim to raise awareness and encourage the regulated community in order to achieve a high level of compliance as early as possible during the regulatory implementation process. The activities will include the following:

  • developing and distributing basic compliance promotion material (including explanatory notes) nationally to regulated parties and other stakeholders;
  • within the first few years following the registration of the Regulations, focusing on regulated parties considered to be those who will be impacted the most by the regulatory provisions;
  • upon request, distributing additional information specific to a given industry sector or region; and
  • training Environment Canada compliance promotion staff in a comprehensive manner to respond to questions from regulated parties.

The coordination and implementation of compliance promotion activities will be completed through the Products Containing Mercury Working Group, composed of Environment Canada officials from headquarters and regional offices. Environment Canada will consider opportunities for compliance promotion coordination with respect to other CEPA 1999 regulations which may have similar regulated activities or parties or compliance promotion approaches.

Coordination and cooperation opportunities also exist to partner with organizations outside Environment Canada in order to perform compliance promotion activities such as identifying regulated parties and delivering key messages. These partnerships may include other federal government departments such as Health Canada and Natural Resources Canada, other levels of government (namely, the provincial and territorial governments), and industry associations.

Compliance promotion activities will be revisited from time to time in order to verify whether the Regulations are being implemented effectively and efficiently.

Enforcement

Since the Regulations will be made under CEPA 1999, enforcement officers, when verifying compliance with the regulatory provisions, will apply the Compliance and Enforcement Policy for CEPA 1999 (the “Policy”). The Policy sets out the range of possible responses to alleged contraventions: warnings, directions, environmental protection compliance orders, ticketing, ministerial orders, injunctions, prosecution, and environmental protection alternative measures, which are alternatives to prosecution after the laying of charges following contraventions of the Act. In addition, the Policy explains when Environment Canada will resort to civil suits by the Crown for cost recovery.

Following an inspection or an investigation, when an enforcement officer discovers an alleged contravention, the officer will choose the appropriate enforcement action based on the following factors:

  • Nature of the alleged contravention: This factor includes due consideration of the damage, the intent of the alleged violator, whether it is a repeat violation, and whether an attempt has been made to conceal information or otherwise subvert the objectives or requirements of the Act.
  • Effectiveness in achieving the desired result: The desired result is compliance with the Act within the shortest possible time frame and with no further repetition of the violation. Factors to be considered include the violator’s history of compliance with the Act, willingness to cooperate and evidence of corrective action already taken.
  • Consistency: In determining the measures to be taken to enforce the Act, consideration will be given by the enforcement officer with respect to how similar situations have been handled.

Environment Canada will monitor and review the regulatory provisions, as necessary, in order to determine whether further enforcement actions may be required to achieve the objective of the Regulations.

Service standards

If the conditions specified in the Regulations are met, a regulated party may request a permit for a product containing mercury. Permit applications are to be submitted to the Minister of the Environment after the Regulations come into force. Applications for permits will be reviewed by Environment Canada. The administrative procedure is not expected to take more than 90 days. Environment Canada will make every effort to respond promptly to permit applications. The administrative process will include the following steps: (1) applications will be reviewed in order to verify that the required information has been provided; (2) follow-up letters will be sent to applicants to inform them that their permit applications have been received and, if needed, to request additional information; and (3) duly completed permit applications will be stamped with the date on which they were received.

Compliance with the service standards for processing permit applications will be monitored and evaluated as part of normal regulatory performance measurement and evaluation.

Performance measurement and evaluation

The Regulations will be administered by Environment Canada’s Products Division. The Division will report on the progress, performance and overall effectiveness of the Regulations, in a confidential manner, through a variety of means, including the CEPA 1999 annual report and departmental performance reports. The information to be contained in these reports regarding the Regulations will come from sources such as information in reports submitted pursuant to the regulatory provisions, permits, data from the Canada Border Services Agency relating to the import of products containing mercury, and targeted studies, as appropriate. These data sources will provide Environment Canada with the information required to measure and evaluate progress towards achieving the objective of the Regulations; that is, to reduce mercury releases to the Canadian environment from products to the lowest level that is technically and economically feasible.

Further evaluation of the Regulations will occur as part of the program evaluation conducted under Canada’s Chemicals Management Plan concerning the federal government’s management of the risks posed by toxic substances.

Contacts

Astrid Télasco
Director
Products Division
Chemicals Sector Directorate
Environmental Stewardship Branch
Environment Canada
351 Saint-Joseph Boulevard, 9th Floor
Gatineau, Quebec
K1A 0H3
Telephone: 819-938-4478
Fax: 819-938-4480
Email: Products.Produits@ec.gc.ca

Yves Bourassa
Director
Regulatory Analysis and Valuation Division
Economic Analysis Directorate
Strategic Policy Branch
Environment Canada
10 Wellington Street, 25th Floor
Gatineau, Quebec
K1A 0H3
Telephone: 819-953-7651
Fax: 819-953-3241
Email: RAVD.DARV@ec.gc.ca

  • Footnote a
    S.C. 2004, c. 15, s. 31
  • Footnote b
    S.C. 1999, c. 33
  • Footnote c
    S.C. 2002, c. 7, s. 124
  • Footnote d
    S.C. 1999, c. 33
  • Footnote 1
    “Fish Consumption Advisories.” Environment Canada: www.ec.gc.ca/mercure-mercury/default.asp?lang=En&n=DCBE5083-1 (accessed in September 2013).
  • Footnote 2
    “Mercury and Human Health.” Health Canada: www.hc-sc.gc.ca/hl-vs/iyh-vsv/environ/merc-eng.php (accessed in September 2013).
  • Footnote 3
    Historically, mercury has been used in a wide range of products, such as explosives and fireworks; antibiotics and pharmaceutical products; fungicides, insecticides and pesticides; pigments; preservatives; and in the treatment of furs and pelts.
  • Footnote 4
    “Notice Regarding Pollution Prevention Planning in Respect of Mercury Releases from Dental Amalgam Waste.” Environment Canada: www.ec.gc.ca/planp2-p2plan/default.asp?lang=En&n=EB42EEDF-1 (accessed in September 2013).
  • Footnote 5
    ToxEcology (Environment Canada, 2009). Socio-economic and mass balance study for mercury-containing products. This study is available upon request.
  • Footnote 6
    These estimates are the result of internal modelling done by Environment Canada.
  • Footnote 7
    “Northern Contaminants Program.” Aboriginal Affairs and Northern Development Canada: www.aadnc-aandc.gc.ca/eng/1100100035611 (accessed in September 2013).
  • Footnote 8
    “Canadian Industry Statistics.” Industry Canada: www.ic.gc.ca/eic/site/cis-sic.nsf/eng/Home (accessed in September 2013).
  • Footnote 9
    Ibid.
  • Footnote 10
    ToxEcology (Environment Canada, 2009). Socio-economic and mass balance study for mercury-containing products. This study is available upon request.
  • Footnote 11
    COWI A/S (European Commission Directorate – General Environment, E.U., final report – December 2008). Options for reducing mercury use in products and applications, and the fate of mercury already circulating in society: ec.europa.eu/environment/chemicals/mercury (accessed in September 2013).
  • Footnote 12
    “Mercury and the Environment.” Environment Canada: www.ec.gc.ca/mercure-mercury/Default.asp?lang=En&n=DB6D2996-1 (accessed in September 2013).
  • Footnote 13
    “National Pollutant Release Inventory.” Environment Canada: www.ec.gc.ca/inrp-npri/default.asp?lang=En&n=4A577BB9-1 (accessed in September 2013).
  • Footnote 14
    States participating in the Interstate Mercury Education and Reduction Clearinghouse include California, Connecticut, Illinois, Louisiana, Maine, Massachusetts, Michigan, Minnesota, New Hampshire, New Jersey, New York State, North Carolina, Rhode Island, Vermont and the State of Washington: www.newmoa.org/ prevention/mercury/imerc.cfm (accessed in September 2013).
  • Footnote 15
    Mercury in lamps is estimated to account for 11% of mercury used in products in Canada in 2013.
  • Footnote 16
    ICF Marbek (Environment Canada, 2012). Supporting data for regulations for mercury-containing lamps. This study is available upon request.
  • Footnote 17
    “Notice Regarding Pollution Prevention Planning in Respect of Mercury Releases from Dental Amalgam Waste.” Environment Canada: www.ec.gc.ca/planp2-p2plan/default.asp?lang=En&n=EB42EEDF-1 (accessed in September 2013).
  • Footnote 18
    ToxEcology (Environment Canada, 2009). Socio-economic and mass balance study for mercury-containing products. This study is available upon request.
  • Footnote 19
    ICF Marbek (Environment Canada, 2012). Supporting data for regulations for mercury-containing lamps. This study is available upon request.
  • Footnote 20
    To put these numbers into perspective, mercury releases to air from products, as reported to Environment Canada’s National Pollutant Release Inventory, were roughly 1 500 kg in 2010, which represented 29% of the total quantity of mercury releases to air in Canada.
  • Footnote 21
    Rice, G. & Hammitt, J.K. (2005). “Economic Valuation of Human Health Benefits of Controlling Mercury Emissions from U.S. Coal-Fired Power Plants.” Northeast States for Coordinated Air Use Management (NESCAUM): www.nescaum.org/topics/mercury (accessed in September 2013).
  • Footnote 22
    Spadaro, J.V. & Rabl, A. (2008). Global health impacts and costs due to mercury emissions. Risk Analysis, 28, 603-613.
  • Footnote 23
    It is understood that there are critical differences in population distributions and mercury exposure levels between Canada and the U.S.; as a result, the U.S. impact values discussed herein should only be interpreted as approximations of Canadian impact values.
  • Footnote 24
    The estimated impact values presented above apply to the neurological impacts of mercury exposure and resulting negative effects on intelligence quotient scores. There is emerging scientific evidence that mercury is also a factor in the risk of heart disease and premature death. Due to uncertainty in the quantification of such potentially significant impacts, they have not been included in this analysis. Given their omission, however, the benefit valuation used (i.e. $6,110 per kg) should be considered as a lower-end estimate of the value of health impacts from reductions in mercury emissions.
  • Footnote 25
    In 2008, close to 50 000 thermometers containing mercury (average price of $20) were imported into Canada, with a total value of almost $1 million: ToxEcology (Environment Canada, 2009). Socio-economic and mass balance study for mercury-containing products. This study is available upon request.
  • Footnote 26
    This estimate does not take into account the elasticity of demand for thermometers containing mercury.
  • Footnote 27
    “Mercury Use in Batteries.” Northeast Waste Management Officials’ Association: www.newmoa.org/prevention/mercury/imerc/factsheets/batteries.cfm (accessed in September 2013).
  • Footnote 28
    This estimate does not take into account the elasticity of demand for button cell batteries containing mercury.
  • Footnote 29
    The nationwide annualized costs due to the Regulations are projected to be about $630,000.
  • Footnote 30
    “Mercury and the Environment.” Environment Canada: www.ec.gc.ca/mercure-mercury/Default.asp?lang=En&n=DB6D2996-1 (accessed in September 2013).
  • Footnote 31
    “News Release — Government of Canada Begins Regulation of Products Containing Mercury.” Environment Canada: www.ec.gc.ca/default.asp?lang=En&n= 714D9AAE-1&news=38DACFC5-5B6B-454F-B544-208F88C9320B (accessed in September 2013).
  • Footnote 32
    CEPA Environmental Registry: www.ec.gc.ca/lcpe-cepa/default.asp?lang=En&n= 6E52AE02-1 (accessed in September 2013).
  • Footnote 33
    “Notice Regarding Pollution Prevention Planning in Respect of Mercury Releases from Dental Amalgam Waste.” Environment Canada: www.ec.gc.ca/planp2-p2plan/default.asp?lang=En&n=EB42EEDF-1 (accessed in September 2013).
  • Footnote 34
    This document may be obtained from the following Web site: “Environment Canada and Health Canada’s Response to Comments Following Consultations on the Proposed Regulations Respecting Products Containing Certain Substances Listed in Schedule 1 to the Canadian Environmental Protection Act, 1999.” Environment Canada and Health Canada: www.ec.gc.ca/mercure-mercury/default.asp?lang=En&n=E4070F21-1 (accessed in September 2013).
  • Footnote 35
    “Mercury from Coal-fired Power Plants.” Canadian Council of Ministers of the Environment: www.ccme.ca/ourwork/air.html?category_id=86 (accessed in September 2013).
  • Footnote 36
    Reduction of Carbon Dioxide Emissions from Coal-fired Generation of Electricity Regulations. Canada Gazette, Part II: www.gazette.gc.ca/rp-pr/p2/2012/2012-09-12/pdf/g2-14619.pdf, p. 1951 (accessed in September 2013).
  • Footnote 37
    “Mercury — Negotiations (The Negotiating Process).” United Nations Environment Programme: www.unep.org/hazardoussubstances/Mercury/Negotiations/tabid/3320/Default.aspx (accessed in September 2013).