Canada Gazette, Part I, Volume 157, Number 12: Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment
March 25, 2023
Transportation of Dangerous Goods Act, 1992
Department of Transport
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Order.)
Issues: Presently, there are no fees charged to process applications and certify persons who are registered with Transport Canada (TC) through the Transportation of Dangerous Goods (TDG) Means of Containment (MOC) Facilities Registration Program. Therefore, there is a strain on TC resources to maintain current service levels, and Canadian taxpayers are subsidizing services provided through the MOC Facilities Registration Program. A cost-recovery regime is needed to ensure that the beneficiaries of TC’s services pay a portion of the costs to provide those services.
Description: The proposed ministerial fees order would introduce fees that would be applicable to operators of container facilities who design, manufacture, requalify, or repair MOCs as well as to design engineers who design standardized MOCs. Fees would also be applicable to service providers to review designs of MOCs, inspect MOCs and provide training to companies that conduct MOC activities. Under the ministerial fees order, fees would be required for
- (1) Initial registrations: for new applicants who want to register with TC and obtain a certificate of registration; and
- (2) Certificate renewals: for applicants with a current certification who want to maintain their certificate of registration with TC. Most certificates must be renewed every five years.
Rationale: Persons registered with TDG’s MOC Facilities Registration Program benefit from this service without sharing the costs to provide this service. A MOC certificate provides registrants the exclusive benefit of market access, which is not available to unregistered persons. Subsection 29(1) of the Transportation of Dangerous Goods Act, 1992 (TDGA) gives the Minister the authority to make orders fixing any fees or charges to be paid for services that TC offers. Implementing the proposed ministerial fees order would require the beneficiaries of MOC services to pay a portion of the costs of these services. The proposed Order would also promote a better balance between the financial burden borne by service recipients and by Canadians generally. A modern fee structure that is adjusted for inflation in accordance with the Service Fees Act will allow TC to address future growth in demand, improve how it delivers its TDG MOC registration services through an innovative registry system, and meet standardized and transparent timelines for service delivery.
The total cost to stakeholders who would need to pay service fees was estimated to be $3.01 million between 2024 and 2033 (present value in 2021 Canadian dollars, discounted to the base year of 2024 at a 7% discount rate).
The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses. The small business lens applies, as there are impacts on small businesses associated with the ministerial fees order. It was estimated that small businesses would assume a total cost of approximately $2.13 million (present value in 2021 Canadian dollars, discounted to the base year of 2024 at a 7% discount rate) between 2024 and 2033.
TC’s MOC Facilities Registration Program is administered through the TDG Directorate and currently costs Canadians approximately $4.8 million annually. Although the TDGA gives the Minister the authority to fix fees, thereby recovering costs, there is no ministerial fees order in place establishing fees to process MOC applications and provide certificates. Implementing a ministerial fees order for MOC registrants would reduce the burden on the Government and the Canadian public, while ensuring that the beneficiaries of services pay an appropriate share for those services.
In Canada, the transportation of dangerous goods is regulated under subsection 5.1, and sections 8 and 9 of the TDGA and Part 5 of the Transportation of Dangerous Goods Regulations (TDGR). There are also multiple technical safety standards incorporated by reference into the TDGR, prescribing detailed requirements for the safe transport of dangerous goods. As prescribed by the TDGA and the TDGR, dangerous goods must be transported in an appropriate MOC. A MOC is the container or packaging used to hold dangerous goods. Along with the TDGA and the TDGR, the safety standards indicate what containers are permitted for a particular dangerous good and prescribe the requirements to design, manufacture, requalify or repair MOCs. For example, certain dangerous goods are held in “small MOCs” with a capacity of less than or equal to 450 L, such as bags, boxes, or cylinders. Others are held in “large MOCs,” such as highway tanksfootnote 1 (e.g. tank trailers and tanker trucks), tank cars,footnote 2 tubes and intermediate bulk containers (IBCs)footnote 3 [IBCs that have a capacity greater than 450 L but less than or equal to 3 000 L and in some cases, up to 5 000 L]. Although not all MOCs are standardized (meaning a MOC to which a safety standard applies under the TDGR), all MOCs must be designed, constructed, filled, closed, secured, and maintained so that under normal conditions of transport, there will be no release of dangerous goods that could endanger public safety and the environment.
MOCs used in Canada are produced both domestically and internationally. Canadian regulations governing MOCs are mostly harmonized with those of the United Nations (UN), allowing the use of UN standardized means of containment (UN packaging, UN portable tanks, etc.) in Canada. Currently, there are reciprocal agreements in place that allow MOCs manufactured in the United States to be used in Canada. In addition, some companies abroad (in the United States or other countries) may choose to be registered with TC through the TDG MOC Facilities Registration Program. This is mainly to facilitate the use of their containers in Canada, as users are aware that companies registered with TC would have met the requirements in the TDGR and its safety standards.
TC reviews applications from persons who wish to be registered to design, manufacture, requalify or repair MOCs in a facility, as well as service providers who review designs of MOCs (e.g. design engineers), inspect MOCs and provide training to MOC companies. An application could include documents regarding the details of the company (e.g. the name and address), the type of MOCs, the types of services provided, and the designs of MOCs. Following the review of an application, TC may need to inspect the applicant’s container facilities to ensure they meet the requirements set out by the TDGR and its safety standards. TC currently recovers the cost for travel and accommodations for international inspections related to the issuance or renewal of a certificate. Certificates of registration are then granted to those persons who meet the requirements. These certificates must be renewed every five years.
Section 29 of the TDGA gives the Minister the authority to fix fees for MOC registrations; however, to date this authority has not been exercised. Therefore, there is currently no fee for the processing of applications and issuing of certificates related to MOCs. The proposal to recover fees for MOC registrations is part of TC’s broader plan to modernize its regulatory regime, services, and fees.
The purpose of the proposed ministerial fees order is to establish fees applicable to operators of container facilities who design, manufacture, requalify, or repair MOCs; to design engineers who design standardized MOCs; and to service providers who review designs of MOCs, inspect MOCs or provide training to employees who manufacture MOCs. By implementing a modern fee regime that requires the beneficiaries of MOC registration services to pay a portion of the costs for these services, TC is promoting better balance between the financial burden borne by service recipients and by Canadians. The proposed fees, which would be adjusted for inflation in accordance with the Service Fees Act, would allow TC to address future growth in demand and support an efficient TDG program.
Under the proposed ministerial fees order, any operator of a container facility, design engineer or service provider required by the TDGR and its standards to be registered to conduct MOC-related activities would be required to pay a fee to initially register with TC as well as to renew their certificate of registration.
Fees for registration
The proposed Order would indicate that the fees would be payable upon application for the issuance or renewal of a certificate of registration. Fees would be payable even if a certificate of registration is not issued.
Registration: An initial registration application is an application by a person to register a container facility to design, manufacture, requalify or repair MOCs, or for a service provider to review designs of MOCs, inspect MOCs or provide training to employees who manufacture MOCs, pursuant to the safety standards prescribed in the TDGR. The successful registrant would receive a certificate that would allow them to conduct MOC activities.
Renewal: A renewal registration application is an application by an existing client to renew a certificate that allows their container facility to remain registered and design, manufacture, requalify or repair MOCs, or in the case of a service provider, continue to review designs of MOCs, inspect MOCs or provide training to employees who manufacture a MOC, pursuant to the safety standards prescribed in the TDGR. The renewal interval for MOC registration certificates is every five years.
Renewal of registration
|Operator of a container facility||$1,700||$1,700|
Phasing in of fees
The proposed fees for processing applications for the initial registration and certificate renewal would be phased in gradually over a period of five years, as noted below and in Table 2.
- Upon coming into force of the proposed ministerial fees order and ending March 31, 2025, fees would be payable at a price equivalent to 60% of the full fee listed in Table 1.
- Beginning April 1, 2025, and ending March 31, 2026, fees would be payable at a price equivalent to 70% of the full fees listed in Table 1.
- Beginning April 1, 2026, and ending March 31, 2027, fees would be payable at a price equivalent to 80% of the full fee listed in Table 1.
- Beginning April 1, 2027, and ending March 31, 2028, fees would be payable at a price equivalent to 90% of the full fee listed in Table 1.
- On April 1, 2028, and on April 1st in each subsequent year, fees would be payable at a price equivalent to 100% of the full fee listed in Table 1.
Initial or renewal registration fee
(60% of final fee)
Initial or renewal registration fee
(70% of final fee)
Initial or renewal registration fee
(80% of final fee)
Initial or renewal registration fee
(90% of final fee)
Initial or renewal registration fee
(100% of final fee)
|Operator of a container facility||$1,020||$1,190||$1,360||$1,530||$1,700|
Fees for foreign facility inspections
TC currently recovers travel-related costs for foreign container facility inspections. Recovered costs include costs for transportation, lodging, meals and incidental expenses in accordance with the rates set out in the National Joint Council Travel Directive. These expenses would continue to be recovered under the proposed order.
New application process
At present, applications for MOC certificates are processed by TC without the payment of a fee. TC would continue to process applications once the proposed ministerial fees order comes into force, but fees for services could be paid using the existing TC online payment functionality. In addition, a new web-based application system is under development and would be rolled out prior to the coming into force of the proposed order. The web-based system would allow persons to submit all documents pertaining to their MOC registration application and pay the associated fee. Applicants would also receive status updates on their file through the system. Once TC has validated that an application is complete, i.e. that it meets requirements for registration and demonstrates compliance with the safety standards, the applicant would receive a certificate of registration or be informed that an inspection would be required prior to the issuance of a certificate.
The MOC stakeholder community is made up of persons who design, manufacture, repair, or requalify MOCs used or intended for use in transportingfootnote 4 dangerous goods, as well as third-party inspectors, trainers and design reviewers, transportation agencies and industry users. Most stakeholders are domestic, with approximately 1 670 domestic container facilities and associated entities currently registered with TC, compared to 215 internationally. Another key group of stakeholders is the TDG General Policy Advisory Council (GPAC). The TDG GPAC is composed of over 40 different industry associations. This group meets twice annually to discuss dangerous goods issues affecting all types of stakeholders across the TDG industry.
Preliminary engagement (2018)
In early October 2018, TC sent a discussion paper to over 1 800 stakeholders, which resulted in a 30-day consultation that closed on November 7, 2018. The purpose of this consultation was to seek feedback on the proposed fee design, fees and service standards. TC received 16 responses from stakeholders. On October 31, 2018, TC hosted a webinar with interested stakeholders to discuss the initiative and present the themes of the discussion document. The webinar was attended by 103 stakeholders, 38 of whom provided feedback. TC also presented an overview of its MOC fee modernization initiative at the GPAC meetings in May and November 2018.
Overall, the rationale for introducing fees for the MOC Facilities Registration Program and the need for fee modernization was understood and accepted by most stakeholders. It was recognized that there is a reasonable rationale for regulatory agencies to pursue cost recovery strategies when service delivery provides benefits to regulated entities. However, there were concerns raised during the consultation period as outlined below.
- Stakeholders perceived the proposed fee amounts as high and stated that costs are already high for industry. In particular, the initially proposed fee range of $750 to $1,000 for administrative amendments, such as modifying the information on file for an already registered MOC design or facility, was of concern. It was also mentioned that the high fees for these activities may discourage companies from keeping their files current with TC.
- Some companies indicated that they may discontinue their activities if the new fees were introduced at the levels proposed. For instance, companies that requalify small cylinders suggested they may cease providing this service since they would not be able to recover the added costs by increasing the price to the consumer, as doing so would make it more cost efficient for consumers to buy a new cylinder.
Competitiveness of the industry
- Stakeholders noted that the introduction of fees, as proposed, could negatively affect some companies’ business activities and their competitive position in the Canadian market, and increase costs for all involved in the dangerous goods supply chain.
- A reduction in registrants could reduce the number of MOCs manufactured in Canada and thus the availability of different MOCs to Canadian consumers and businesses.
Clarify service structure
- Some stakeholders commented on the complexity of the proposed fee structure and suggested that TC provide definitions of the applications types to mitigate uncertainty as to where a stakeholder’s service request would fall within the proposed fee structure.
Grouping or discounting fees
- Stakeholders asked whether TC would consider providing a “bundle” discount for the registration of multiple designs or multiple facilities, or a “financial break” as an incentive for those who are fully compliant with TDG regulatory requirements and hold several certificates.
- Stakeholders mentioned that the proposed fees could result in less external inspection and requalification services being offered in rural areas if MOC companies found it no longer made economic sense to operate there. A loss of MOC services could create an additional expense to other types of businesses that operate in rural areas, as they would need to transport their MOC to larger centres for external inspections or requalification.
TC noted the impact the proposed fees could have on the industry and how charging for certain types of administrative changes to a registration could result in reduced compliance with the TDGR if companies began under-reporting their involvement in the MOC industry. Under-reporting would negatively impact TDG’s safety and oversight.
TC took all the feedback into consideration and developed a revised cost recovery approach that aims to respond to the main themes heard during the initial consultation:
- No fee for administrative changes or amendments to registrations, as fees would only be charged for initial registrations and renewals;
- The proposed fees were lowered; and
- The fee structure was streamlined, and hundreds of service request types are now grouped into three service categories with more easily understood proposed fees.
Follow-up stakeholder consultation (2021)
Given that the proposal had undergone significant revisions, stakeholders were invited to provide their feedback at a GPAC meeting held in May 2021, and at webinars held in June 2021. There were 259 stakeholders who attended the webinars in June.
The key concerns raised by stakeholders and TC’s response are as follows:
- Although most stakeholders felt that the proposal was clearer and more reasonable, there were still some concerns about the costs and the potential impacts that it could have on smaller businesses, as well as those in rural communities. During the webinar, TC explained that the fees would be payable only every five years or until the certificate of registration expires, limiting the financial burden, and that the service standard would be improved, resulting in predictable service for industry, since clients would be able to track the status of their application with the knowledge that TC is committed to processing it within a defined time frame.
Clarity on types of services included
- Stakeholders wanted to clarify if the new fees would be applicable to all persons currently registered with TC. Stakeholders also asked if making changes to their design would result in additional fees. It was clarified that the new fees would apply to anyone who must register with TC to design, manufacture, requalify or repair MOCs, or for third-party agencies to review designs of MOCs, inspect MOCs or provide training to employees who manufacture MOCs. Any modification to a client’s registration profile, such as including a new design, would be considered an administrative amendment for which no fee would apply.
- Some stakeholders wanted to know when these fees would come into effect. During the webinar, TC clarified that these fees would be charged starting six months after the publication of the ministerial fees order in the Canada Gazette, Part II.
Conditions for reimbursing fees
- Stakeholders asked if TC would consider reimbursing applicants if an application is refused. It was clarified that the fee is paid before the application is processed and is non-refundable. As discussed in greater detail below under the “Service standards” section, TC has a remission policy in place that would allow an applicant to recover part of their fee if a service standard was not upheld and TC was responsible for the delay.
Modern treaty obligations and Indigenous engagement and consultation
In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an analysis was undertaken to determine whether the proposed ministerial fees order is likely to give rise to modern treaty obligations. This assessment examined the geographic scope and subject matter of the proposed order in relation to modern treaties in effect, and no modern treaty obligations were identified.
Currently, the financial burden of providing the MOC registration services falls on all Canadians, while registered persons benefit exclusively from the MOC Facilities Registration Program. Therefore, there is a need to recover a portion of these costs from persons who conduct MOC activities.
Section 29 of the TDGA provides that the Minister may, by order, establish fees for certain services TC provides. A ministerial fees order was therefore proposed to recover costs for the MOC Facilities Registration Program. This instrument would address the issues outlined above and better balance the financial burden of the service delivery costs between service recipients and taxpayers.
Maintaining the status quo would not respond to the issues raised above and would continue to support an outdated system with disproportionate service benefits.
Operators of container facilities, design engineers and service providers who wish to register with TC to conduct MOC-related activities would be required to pay a portion of TC’s service cost of processing applications for initial and renewal registrations. The analysis below examines the costs and benefits attributed to Canadians through this proposal. Due to the cost recovery nature of the proposed ministerial fees order, the costs to domestic stakeholders represent a rebalance of the cost burden from Canadians (represented by TC) to domestic stakeholders; whereas the costs to foreign stakeholders would represent a net gain in the cost recovered by TC (since these costs would not be borne by Canadians). Therefore, costs to domestic stakeholders would have a neutral impact on Canadian society, while costs to foreign stakeholders are considered a benefit to Canadians.
The total cost to Canadian users of MOC registration services would be $2.66 million (present value in 2021 Canadian dollars, discounted to 2024 at a 7% rate) between 2024 and 2033. During the same analytical period, the total benefit (i.e. recovered cost by TC) would be $3.01 million, $2.66 million of which would be service revenue paid by domestic MOC registration service users and $0.35 million by foreign users. As a result, the net benefit for this proposal would be $0.35 million (present value in 2021 Canadian dollars, discounted to 2024 at a 7% rate) in total between 2024 and 2033.
The fees charged to industry would be used to recover about 17% of the costs incurred by TC to provide MOC registration services, which are currently funded entirely by Canadian taxpayers. Therefore, the ministerial fees order would rebalance a portion of the costs from Canadian taxpayers to the TC clients who benefit from the services.
The costs and benefits for the proposed ministerial fees order have been assessed in accordance with the Treasury Board of Canada Secretariat (TBS) Policy on Cost-Benefit Analysis. Where possible, impacts are quantified and monetized, with only the direct costs and benefits for stakeholders being considered in the cost-benefit analysis.
Benefits and costs associated with the proposed order are assessed based on comparing the baseline against the regulatory scenario. The baseline scenario depicts what is likely to happen in the future if the Government of Canada does not implement the proposed order. The regulatory scenario provides information on the intended outcomes as a result of the proposed order.
The analysis estimated the impact of the proposed order over a 10-year period from 2024 to 2033, with the year 2024 being when the proposed order is expected to be coming into force. Unless otherwise stated, all costs are expressed in present value in 2021 Canadian dollars, discounted to the year of 2024 at a 7% discount rate.
It is also important to note that proposed fees presented in Table 1 above are in 2024 Canadian dollars. For the purpose of this analysis, they have been adjusted to 2021 Canadian dollars using the Conference Board of Canada’s Consumer Price Index (CPI) Forecast.
The proposed ministerial fees order would apply to companies involved in the design, manufacture, and repair or requalification of dangerous goods MOC. Three categories of MOC registrants would be impacted by the proposed order: those registering container facilities, service providers (inspecting or providing training) and design engineers. Table 3 shows a breakdown of active registrations for each stakeholder category. A total of 215 certificates are held by foreign companies while 1 670 are held by Canadian companies. Large companies with multiple facilities would pay for a certificate of registration for each location. According to TC subject matter experts, and regarding the size of affected domestic companies, it was estimated that 80% would be small businesses.footnote 5
|Certificates of registration type||Domestic certificates||Foreign certificates|
|Operator of a container facility||1 572||162|
|Total active certificates||1 670||215|
It is expected that the introduction of fees would decrease the number of registrations during the analytical time frame, as some small companies may decide to stop their activities (see details below). This may be caused by those businesses that have low volumes of MOCs, particularly in cases where MOCs are not their main service or revenue stream. For example, a manufacturer with a few clients requiring MOCs may decide to no longer provide this service once fees are required, as they may find that the cost of providing this service now outweighs the revenue generated. They may also choose to pay the fee only when they have a significant order. Moreover, containers produced in the United States are accepted in Canada through reciprocal agreements. This harmonization with the United States could also lead to a decrease in the number of registrations in some areas, as some foreign facilities may discontinue their registration if they no longer wish to register with TC to avoid paying these fees.
Baseline and regulatory scenarios
Under the baseline scenario, certificates of registration are granted to companies that submit application requests that meet the requirements set out by the TDGA, the TDGR and the relevant technical safety standards. Registration services are provided by TC free of charge, and certificates of registration are renewed every five years. For inspections at a foreign registrant’s facility, TC only recovers the travel, meals, accommodation, and incidental costs incurred by TC officials to perform the inspection. Based on historical data, it is expected that the annual number of active certificates would decline over the analytical timeframe.
Under the regulatory scenario, TC would introduce fees for the TDG MOC registration service users. Initial and renewal fees would be charged to companies registering for container facilities, to service providers, and to design engineers. TC would continue to recover travel and accommodation costs incurred by TC officials for a foreign registrant’s facility inspection. Table 4 below shows the proposed fees adjusted to 2021 Canadian dollars of the proposed order. In addition, the proposed fees would further reduce the annual number of active certificates, which was estimated to be 5% more than what is projected under the baseline scenario.
|Applicant||Initial and renewal fees table b1 note *|
|Baseline Scenario||Regulatory scenario|
|Coming into force date to March 2025||April 2025 to March 2026||April 2026 to March 2027||April 2027 to March 2028||April 2028 to March 2029||April 2029 and onward|
Table b1 note(s)
Costs and benefits
Costs to industry are derived by multiplying proposed fees and the number of expected active certificates over the 10 years of analysis.
As presented in Table 3, there are 1 885 active certificates issued prior to 2024. For the purpose of this analysis, it is assumed that no new registration and renewal would occur in 2023, and all existing active certificates would be renewed in 2029. In addition, it is assumed that TC would register an average of 143 new applications every year during the analytical time frame (i.e. 2024 to 2033), which would be renewed every five years.
Costs to industry are presented below by type of registration certificates and by type of stakeholders.
Costs by type of registration certificates
As presented in Table 5, about 95% of the total cost would apply to container facilities registration ($2.84 million) since the majority of certificates of registration are for container facilities. The rest of the total cost would apply to service providers registration (2% of the total cost, $0.07 million) and to design engineer registration (3% of the total cost, $0.10 million).
|Type of registration certificates||Total cost||Percentage|
Costs by type of stakeholders
The costs associated with the proposed Order would be incurred by Canadian and foreign companies involved in the designing, manufacturing, repairing, and requalifying of dangerous goods MOC. Domestic stakeholders would incur most of the costs, $2.66 million in total (89% of the total cost), while foreign stakeholders would incur a total cost of $0.35 million (11% of the total cost).
|Stakeholders||Container facilities||Service providers||Design engineers||Total|
Cost to the Government
For the payment of the proposed fees, stakeholders will use an existing myTC online payment service, which would be adapted and linked to a new web page and platform for the application registration. For this purpose, a development team is working on integrating and adapting the various systems. TC is currently upgrading the payment service system with new features including the ones associated with fee payment. It is expected that the system upgrade and onboarding would be completed before the coming into force of the proposed Order. Therefore, costs related to the system are not monetized for this analysis, as they are outside of the analysis scope.
As previously stated, the proposed Order would result in rebalancing the cost from Canadians to users of the MOC registration services. The total cost recovered by TC from industry would be $3.01 million, $2.66 million of which would be from service fees paid by domestic stakeholders and $0.35 million by foreign stakeholders.
- Number of years: 10 (2024 to 2033)
- Base year for costing: 2021
- Present value base year: 2024
- Discount rate: 7%
|Impacted stakeholder||Description of cost||Base year (2024)||2025||2026||2027||2028|| Annual
|Domestic companies||Fee charged by TC||0.10||0.10||0.10||0.10||0.10||0.51||0.12||2.66||0.38|
|Foreign companies||Fee charged by TC||0.01||0.01||0.01||0.01||0.01||0.07||0.02||0.35||0.05|
|All stakeholders||Total cost||0.11||0.11||0.11||0.11||0.11||0.58||0.14||3.01||0.43|
|Impacted stakeholder||Description of benefits||Base year (2024)||2025||2026||2027||2028||Annual average (2029–2032)||Final year (2033)||Total (present value)||Annualized value|
|Government||Government total cost recovery||0.01||0.01||0.01||0.01||0.01||0.07||0.02||0.35||0.05|
|Impacts||Base year (2024)||2025||2026||2027||2028||Annual average (2029–2032)||Final year (2033)||Total (present value)||Annualized value|
Small business lens
Analysis under the small business lens concluded that the proposed ministerial fees order would impact small businesses. Based on TC subject matter experts, 80% of domestic affected stakeholders would be a small business. Thus, small businesses would bear a total cost estimated at $2.13 millionfootnote 6 between 2024 and 2033.
The new fees would apply equally to all companies regardless of size. Recognizing these impacts, TC incorporated the feedback received from stakeholders and has made several changes to the original proposed fees and its structure. These changes include removing fees for all administrative amendments and charging fees for initial registrations and renewal only and lowering the overall fees and grouping some fees together, particularly for standards that list registration requirements for multiple activities under the same clause (e.g. Canadian Standards Association [CSA] Standard B339, “Cylinders, spheres, and tubes for the transportation of dangerous goods”). These activities would now be registered under one unique registration.
Furthermore, to address small business concerns more generally, fees would be phased in gradually over a five-year period, as shown in Table 2. As this approach reduces the financial burden on affected stakeholders, both in terms of the total amount to be paid and the time required to pay the full amount, it thus mitigates the impact that the fees would have on the growth of the industry as it recovers from the challenges encountered following the COVID-19 pandemic. In addition, it would ensure that stakeholders whose registration comes due for renewal soon after the fees take effect are not unduly penalized.
Small business lens summary
- Estimated number of small businesses:footnote 7 1 336
- Number of years: 10 (2024 to 2033)
- Base year for costing: 2021
- Present value base year: 2024
- Discount rate: 7%
|Activity||Annualized value||Present value|
|TC service fees||$0.30 million||$2.13 million|
|Cost per impacted business||$227||$1,592|
|Total compliance cost (all impacted small businesses)||$0.30 million||$2.13 million|
The one-for-one rule does not apply, as there is no incremental change in the administrative burden on businesses. The introduction of fees would not change the registration process which remains the same, apart from paying the fees online. The fee payment online would not increase the administrative burden on businesses.
Regulatory cooperation and alignment
The proposed ministerial fees order is not being introduced to comply with an international agreement or obligation, nor does it have any impacts related to a work plan or commitment under a formal regulatory cooperation forum. Currently, other international jurisdictions such as the United States and Australia do not charge fees for MOC registration as is being proposed in Canada. However, these countries charge fees for other TDG services such as registration for the transporting of certain dangerous goods in the United States. Also, in Australia, different states impose fees for various services including licensing drivers who transport dangerous goods and approving tank designs. Although the proposed Order would not align internationally with respect to registration fees, it would not impact other areas of alignment with respect to TDG practices internationally. Also, as was mentioned above, since the TDGR and corresponding safety standards governing MOCs in Canada are mostly aligned with those of the UN (UN standardized means of containment), UN packaging, UN large packaging, UN IBC, and UN portable tanks that have been manufactured and marked by other countries can also be used in Canada.
Given our shared border and the high volume of dangerous goods being transported between the United States and Canada, there are reciprocal agreements in place between both countries. These reciprocal agreements mean that a MOC manufactured to a U.S. standard will automatically be accepted in Canada and vice versa. Although the United States does not charge registration fees, they do charge fees for some MOC-related services. These fees are based on the type and size of the operations. The fees being proposed under the order would depend on the type of operation but not the size. Implementing the proposed Order in Canada would not cause any disruptions in the flow of dangerous goods between Canada and the United States.
Strategic environmental assessment
The proposed ministerial fees order would introduce new fees for an existing service in order to recover costs. The proposed order is not expected to result in important environmental aspects. In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus
MOC registrants are expected to benefit directly from this initiative. Registrants would benefit from a service standard, improved submission tools for their applications, clarity and transparency in the application process and the ability to continue performing MOC-related activities throughout Canada. As with most of the transportation industry, it is estimated that at least 80% of these registrants are males and Caucasian.
Although introducing fees for MOC registrants is not expected to have any significant negative impacts that would create or exacerbate gender diversity inequalities, there are some potential negative economic impacts on some companies or individuals that register with the TDG MOC Facilities Registration Program, as well as the dangerous goods transportation industry. For example, in earlier consultations, some stakeholders mentioned they may not be able to absorb the costs to register with TC, which could result in a loss of some services. Such losses may impose additional expense to businesses that use MOCs, as this would decrease the availability of MOCs and MOC services. Particularly for those who operate in rural areas, having fewer companies could increase costs, as they would need to transport their MOC to larger centres for external inspections or requalification.
To reduce the economic impact on businesses, TC revised its original proposal by implementing the following:
- Refinement of the services that would be subject to fees: Fees would only be applicable to the initial registration and the renewal of certificates. Consequently, all amendment type services, such as changes to an applicant’s profile or adding a new design, would be processed free of charge. Moreover, businesses that hold multiple certificates at the same facility would only be charged one fee for the same type of MOC;
- Simplified and improved fee structure: All services pertaining to the registration of a container facility have been placed into three categories, aligned to the classes of client that seek MOC registrations, to make it less complex for stakeholders to know what type of services they would need and how much it would cost. There would also be a rollout of an improved electronic system to submit applications, pay fees and receive timely updates on the status of an application;
- Price: Fees have been lowered since the initial proposal. Currently, TC would only be recuperating an estimated 17% of the total cost to deliver this program. Moreover, fees would only be required every five years depending on the corresponding standard; and
- Phasing-in of the fees: A phased-in approach was chosen to introduce the fees gradually over a five-year period, as shown in Table 2, in order to reduce the financial burden on stakeholders and give them time to plan and budget for the new requirements.
Along with the above revisions, the proposal includes a new service standard on which the industry has been consulted. Contrary to how things are done currently, under the proposed ministerial fees order, transparency in the application process would increase, as MOC applicants would have clear expectations of how long it would take to review their application.
TC would continue applying a gender-based analysis plus (GBA+) and intersectionality lens in all future engagements with industry.
Implementation, compliance and enforcement, and service standards
The proposed ministerial fees order would come into force six months after it is published in the Canada Gazette, Part II. TC is currently developing an online application where persons wishing to register with TDG MOC can submit any necessary documents relevant to their application and receive status updates on their submissions. Payment could be made through an existing myTC Account online method. TC anticipates that the application would launch prior to the coming-into-force date of the proposed order. During the transition to the new system, applicants would still be able to submit applications to TC through the traditional methods: by email, phone, or mail.
TC monitors this regulated body of stakeholders to note how many applicants are registered, how many businesses are inactive and how often businesses update their profiles. This system would be enhanced to ensure that it continues to meet the needs of stakeholders and is efficient. Stakeholders would be encouraged to provide their feedback and inform TC of any issues they may have with using the system.
Applications made prior to the coming-into-force date of the ministerial fees order would not be subject to the fees established in the order. Applications received after the six-month transitional period would be subject to the fees outlined in the order and would be payable before TC would begin processing the application for registration. To ease the financial burden on stakeholders, TC is implementing a phase-in approach for the proposed fees over a period of five years.
TC would develop guidance and explanatory materials to ensure that the new fees are applied consistently across Canada, and to ensure that stakeholders clearly understand how and when the fees would be applied. These materials would be available prior to the new fees coming into force. Some of the tools that TDG would use to raise awareness of the proposed order and fees are
- the TC website: The Department’s web pages are updated on a regular basis with various communication products, as well as specific sections for awareness material (e.g. Frequently Asked Questions, Alerts, Advisory Notices and Bulletins). Notices with respect to the proposed order would be placed on the relevant pages of the TC website. On the TDG page, inspectors would conduct safety awareness activities by, among other things, discussing materials made available to the regulated parties. The website would also be updated to include the proposed ministerial fees order.
- the TDG GPAC: During GPAC meetings, TC consults and provides information/updates on research and regulatory changes that are proposed and their coming-into-force dates. This is a forum through which stakeholders can share any concerns with upcoming proposals.
- the TDG Newsletter: The Newsletter, published semi-annually since 1980, is distributed to over 15 000 readers in Canada and abroad. It is free of charge and available in hard copy and electronically on the TDG web page.
Compliance and enforcement
Since registrants are expected to pay before their applications are processed, enforcement would not be necessary for payment. As mentioned above, inspections are conducted, if needed, to establish that the requirements for the issuance of the certificate have been met. In the case of such inspections abroad, foreign clients are currently required by contract to absorb the costs of transportation, accommodation, meals and incidental expenses for TC inspectors. These costs would continue to be payable under the proposed order.
With respect to payment of the fees being proposed under this order, any fees owing would constitute a debt due to His Majesty in right of Canada and may be recovered in any court of competent jurisdiction, in accordance with the relevant provisions of the Financial Administration Act.
The Service Fees Act requires that government departments include four key concepts in their cost recovery initiatives: consumer price indexing, service standards, annual reporting, and a remission policy. In accordance with the Service Fees Act and as part of its commitment to improve service delivery and performance, a service standard for the recovery of fees in the TDG MOC Facilities Registration Program has been developed and would be in place when the proposed order comes into force. The service standard would indicate that within 45 business days of TC receiving an application, a member of TDG Engineering Services would review the application and inform the applicant whether an inspection is required or issue a certificate. The proposed service standard would come into effect the day the ministerial fees order comes into force.
TC’s remission policy has been in effect since April 2021 and would apply to this cost recovery initiative. In cases where a service standard is not met, a portion of the fee would be remitted to the client in accordance with the Service Fees Act, the Treasury Board Directive on Charging and Special Financial Authorities and the TC remissions policy. The remission policy states that, if a service standard is missed by 25% (12 days) or more, then 25% of the fee would be returned to the registrant. The remission policy does not apply to service standards missed by anything less than 12 days. Delays not caused by TC’s processing of the files (e.g. delays due to missing documents from the applicant) would not be calculated towards the 12 days.
Regulatory Development Division
Regulatory Frameworks and International Engagement Branch
Transportation of Dangerous Goods Directorate
300 Laurier Avenue West
PROPOSED REGULATORY TEXT
Notice is given that the Minister of Transport proposes to make the annexed Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment under subsection 29(1)footnote a of the Transportation of Dangerous Goods Act, 1992 footnote b.
Interested persons may make representations concerning the proposed Order within 60 days after the date of publication of this notice. They are strongly encouraged to use the online commenting feature that is available on the Canada Gazette website but if they use email, mail or any other means, the representations should cite the Canada Gazette, Part I, and the date of publication of this notice, and be sent to Lisa Tellier, Acting Chief, Regulatory Development Division, Regulatory Frameworks and International Engagement Branch, Transportation of Dangerous Goods Directorate, Department of Transport, L’Esplanade Laurier (ASDD), 300 Laurier Avenue West, Ottawa, Ontario K1A 1J2 (email: TC.TDGRegulatoryProposal-TMDPropositionReglementaire.TC@tc.gc.ca).
Ottawa, March 2, 2023
Minister of Transport
Order Fixing Fees for Registrations Related to Dangerous Goods Means of Containment
1 The following definitions apply in this Order.
- certificate of registration
- means a document that is issued by the Minister to the operator of a container facility, a design engineer or a service provider that certifies they are registered for the purposes of Part 5 of the Transportation of Dangerous Goods Regulations. (certificat d’enregistrement)
- container facility
- means a facility where any of the following activities is carried out in respect of a standardized means of containment that is used for the transportation of dangerous goods:
- (a) design;
- (b) manufacturing;
- (c) repair; or
- (d) requalification. (installation de contenants)
- design engineer
- means an individual who designs a standardized means of containment. (ingénieur de conception)
- means the periodic testing or inspection of a standardized means of containment. (requalification)
- service provider
- (a) a person, other than the Minister, that provides to the operator of a container facility
- (i) an inspection service,
- (ii) a service for the validation of a container design facility, or
- (iii) training; or
- (b) an operator of a container facility that provides training to their employees. (fournisseur de services)
- (a) a person, other than the Minister, that provides to the operator of a container facility
Fees and Costs
Certificate of registration
2 A person referred to in column 2 of the schedule who applies to the Minister for a certificate of registration or for the renewal of a certificate of registration must pay to the Minister, at the time of application, the corresponding fee set out in column 3.
Reimbursement of costs
3 If an employee of the Department of Transport must travel outside Canada to inspect a container facility as part of the review of an application for the issuance or renewal of a certificate of registration for that facility, the following costs associated with that travel are to be calculated in accordance with the rates set out in the National Joint Council Travel Directive, as amended from time to time, and are payable to the Minister by the operator of that facility:
- (a) transportation;
- (b) lodging;
- (c) meals; and
- (d) incidental expenses.
Coming into Force
180th day after publication
4 This Order comes into force on the 180th day after the day on which it is published in the Canada Gazette, Part II.
Initial Registration or Renewal ($)
|1||Period ending on March 31, 2025||Operator of a container facility||1,020|
|2||Period beginning on April 1, 2025 and ending on March 31, 2026||Operator of a container facility||1,190|
|3||Period beginning on April 1, 2026 and ending on March 31, 2027||Operator of a container facility||1,360|
|4||Period beginning on April 1, 2027 and ending on March 31, 2028||Operator of a container facility||1,530|
|5||Period beginning on April 1, 2028||Operator of a container facility||1,700|
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