Annex 2 - Canadian Legislative System and Institutional Framework

2.0 Introduction

Five pieces of legislation currently govern the nuclear sector in Canada: the Nuclear Safety and Control Act (NSCA); the Nuclear Energy Act (NEA); the Nuclear Fuel Waste Act (NFWA); the Nuclear Liability Act (NLA); and the Canadian Environmental Assessment Act (CEA Act). The NSCA is the main legislation dealing with safety considerations.

2.1 Nuclear Safety and Control Act

The NSCA was passed by Parliament on March 20, 1997. This was the first major overhaul of Canada's nuclear regulatory regime since the Atomic Energy Control Act (AECA) and the creation of the Atomic Energy Control Board (AECB) in 1946. The NSCA provides legislative authority which covers the nuclear sector regulatory developments. These developments include health and safety standards for atomic energy workers, environmental protection measures, security regarding nuclear facilities and public input into the licensing process.

The NSCA establishes the CNSC, which is comprised of the Commission Tribunal (the tribunal which makes licensing decisions) and the CNSC personnel, who makes recommendations to the Commission Tribunal, exercise delegated licensing and authorization powers and assess licensee compliance with the NSCA, its associated regulations, and licence conditions.

Section 26 of the NSCA states that, "Subject to the regulations, no person shall, except in accordance with a licence,

• possess, transfer, import, export, use or abandon a nuclear substance, prescribed equipment or prescribed information,
• mine, produce, refine, convert, enrich, process, reprocess, package, transport, manage, store or dispose of a nuclear substance,
• produce or service prescribed equipment,
• operate a dosimetry service for the purposes of this Act,
• prepare a site for, construct, operate, modify, decommission or abandon a nuclear facility, or
• construct, operate, decommission or abandon a nuclear-powered vehicle or bring a nuclear-powered vehicle into Canada."

The NSCA authorizes the CNSC to make regulations, which had to be developed before the NSCA could be fully implemented. The regulations include:

• General Nuclear Safety and Control Regulations,
• Radiation Protection Regulations,
• Class I Nuclear Facilities Regulations,
• Class II Nuclear Facilities and Prescribed Equipment Regulations,
• Uranium Mines and Mill Regulations,
• Nuclear Substances and Radiation Devices Regulations,
• Packaging and Transport of Nuclear Substances Regulations,
• Nuclear Security Regulations, and
• Nuclear Non-Proliferation Import and Export Control Regulations.

The CNSC is the governmental authority responsible for implementing the requirements of the Canada/IAEA safeguards agreement, pursuant to Article III of the Nuclear Non-Proliferation Treaty. In this capacity, the CNSC acts as Canada's State System of Accounting and Control of nuclear materials (SSAC). Most of the nuclear materials and facilities that are identified in this report, in accordance with the Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management, are also subject to the terms and conditions of the Canada/IAEA safeguards agreement.

2.2 Nuclear Energy Act

Concurrent with the NSCA, the NEA came into force in 2000. It is a revision of the AECA (1946) to address the development and utilization of nuclear energy (with the regulatory aspects of the AECA having been removed to the NSCA). AECL is authorized under the NEA. The NEA gives the designated government minister the authority to:

• undertake or cause to be undertaken research and investigations with respect to nuclear energy,
• with the approval of the Governor-in-Council, utilize, cause to be utilized and prepare for the utilization of nuclear energy,
• with the approval of the Governor-in-Council, acquire or cause to be acquired, by purchase, lease, requisition or expropriation, nuclear substances and any mines, deposits or claims of nuclear substances and patent rights relating to nuclear energy and any works or property for production or preparation for production of, or for research or investigations with respect to, nuclear energy, and
• with the approval of the Governor-in-Council, license or otherwise make available or sell or otherwise dispose of discoveries and inventions relating to, and improvements in processes, apparatus or machines used in connection with, nuclear energy and patent rights acquired under this Act and collect royalties and fees on and payments for those licenses, discoveries, inventions, improvements and patent rights."

2.3 Nuclear Fuel Waste Act

Three provincial nuclear utilities, Ontario Power Generation (OPG), Hydro-Québec and New Brunswick Power, own 98 percent of the nuclear fuel waste in Canada. Most of the remainder is owned by AECL. Following a decade long environmental assessment for a deep geologic disposal concept for spent fuel, which ended in 1998, it became clear that the Government of Canada needed to put in place a process to ensure that a long-term management approach for Canada's spent fuel would be developed and implemented. Given the relatively small volume of spent fuel in Canada, it was determined that a national solution would be in the best interest of Canadians.

On November 15, 2002, the Government brought into force the NWFA, which made the owners of spent fuel clearly responsible for the development of long-term waste management approaches. The document required waste owners to establish a waste management organization as a separate legal entity to manage the full range of long-term spent fuel management activities. It also required waste owners to establish trust funds with independent third party trust companies, so as to finance their long-term waste management responsibilities. Through the waste management organization, the owners were required to prepare and submit a study to the Government of Canada of proposed approaches for the long-term management of the waste, along with a recommendation on which of the proposed approaches should be adopted. The NFWA required this analysis to include feedback from comprehensive public consultations that included Aboriginal peoples and be evaluated in terms of social and ethical considerations.

Under the NFWA, the federal government is responsible for reviewing the study prepared by the waste management organization, selecting a long-term management option from those proposed and providing oversight during its implementation.

As required by the NFWA, the waste owners established the NWMO and the trust funds necessary to finance the implementation of long-term waste management activities. Following extensive studies and public consultation, the NWMO submitted its study of options to the Government of Canada on November 3, 2005. The NWMO presented four options, including those listed in the NFWA:

• long-term storage at the reactor sites,
• central shallow or below ground storage,
• deep geologic disposal, and
• a fourth option called the Adaptive Phased Management (APM) approach, which combines the three previous options within a flexible, adaptive management decision-making process.

On June 14, 2007, the Government of Canada announced that it had selected the APM approach for the long-term management of spent fuel in Canada. The APM approach recognizes that people benefiting from nuclear energy produced today must take steps to ensure that the wastes are dealt with responsibly and without unduly burdening future generations. At the same time, it is sufficiently flexible to adjust to changing social and technological developments.

The NWMO is required to implement the Government's decision according to the NFWA, using funds provided by the waste owners.

The NFWA is administered by NRCan's Nuclear Fuel Waste Bureau (nfwbureau.gc.ca).

2.4 Nuclear Liability Act

The Nuclear Liability Act (NLA) establishes the legal regime that would apply in the event of a Canadian nuclear incident resulting in civil damages. The NLA is administered by the CNSC, while NRCan has responsibility for policy direction. The NLA can be viewed at laws.justice.gc.ca

The NLA places total responsibility for nuclear damage on the operator of a nuclear installation. It requires the operator to carry insurance in the amount of $75 million and also provides for the establishment of a Nuclear Damage Claims Commission, in the event of a serious nuclear incident. This commission would deal with claims for compensation when the federal government deems that a special tribunal is necessary; for example, if claims are likely to exceed $75 million.

On October 26, 2007, the Minister of Natural Resources introduced in Parliament Bill C-5, "an Act respecting civil liability and compensation for damage in case of a nuclear incident". The proposed legislation updates and modernizes the current NLA (1976). Bill C-5's features include increased liability of nuclear operators ($650 million versus the current $75 million), a mechanism for periodic updating of the operator's liability, a longer limitation period for submitting compensation claims for bodily injury (30 years versus the current 10 years), the clarification of a number of key concepts and definitions, and greater definition of compensation procedures. As of June 2008, Bill C-5 had completed the Second Reading - Report Stage in the House of Commons.

At present, Canada is not a member of any of the international nuclear civil liability conventions; however, Canada has a reciprocity arrangement governing nuclear civil liability with the United States.

2.5 Canadian Environmental Assessment Act

The Canadian Environmental Assessment Act (CEA Act) sets out responsibilities and procedures on projects for which the federal government holds decision-making authority - whether as a proponent, land administrator, source of funding, or regulator. The CEA Act can be viewed at laws.justice.gc.ca online.

The majority of federal projects requiring an Environmental Assessment (EA) undergo either a screening or a comprehensive study. Both can be considered self-directed EAs, in the sense that the responsible authority determines the scope of the EA and the scope of the factors to be considered in the process. The responsible authority is directly involved and responsible for managing the EA process and for ensuring that an EA report is prepared. The responsible authority is the federal decision-maker, carrying responsibility under the CEA Act. As such, the CNSC is a responsible authority for any projects that it regulates. NRCan is the responsible authority for projects that it funds.

In practice, the project proponent may be delegated to conduct technical studies for the EA, the implementation mitigation measures and a follow-up program. The responsible authority alone, however, remains directly responsible for ensuring that the screening or comprehensive study is carried out in compliance with the CEA Act, and for deciding on the course of action to ensure that the project follows the screening or comprehensive study procedures.

The CEA Act requires the EA of a proposed project to evaluate the possible impacts of all licensing stages before any irrevocable decisions are made. The CEA Act has four objectives:

1. to ensure that the environmental effects of the project receive careful consideration before a responsible authority takes an action,
2. to encourage responsible authorities to take actions that promote sustainable development, thereby achieving or maintaining a healthy environment and a healthy economy,
3. to ensure that projects to be carried out in Canada or on federal lands do not cause significant adverse environmental effects outside the jurisdictions in which the projects are carried out, and
4. to ensure that there will be an opportunity for public participation in the Environmental Assessment process, as appropriate.

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