SOR/2016-273: Regulations Amending the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations
REGISTRATION OF FEDERAL REGULATION - VIA OIC DATABASE, PRIOR TO PART II OF THE GAZETTE
October 21, 2016
REGULATORY IMPACT ANALYSIS STATEMENT (This statement is not part of the Regulations.) Issues Since the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations (the Regulations) came into force in 2005, there has been a small number of exports that have been refused by the importing country or a transit country because the waste or recyclable materials were prohibited or... (Click for more)
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Published on October 21, 2016
SOR/2016-273: Regulations Amending the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations
REGULATORY IMPACT ANALYSIS STATEMENT (This statement is not part of the Regulations.) Issues Since the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations (the Regulations) came into force in 2005, there has been a small number of exports that have been refused by the importing country or a transit country because the waste or recyclable materials were prohibited or controlled in one or both of these countries. However, the exported materials were not covered under Canadian regulations, usually because they were collected from households. These wastes or recyclable materials were subject to the United Nations Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal (Basel Convention (see footnote 2)); consent was therefore required from the importing and transit countries before their transboundary movement. These exports included a shipment of household recyclable materials to the Philippines in 2013. In addition, the Department of the Environment (the Department) identified inconsistencies between the Basel Convention requirements and the return provisions of the Regulations for permitted imports or exports that cannot be completed as planned. The return provisions of the Regulations currently apply only when the destination facility does not accept or refuses a shipment. However, there may also be situations in which the authorities of the importing country or a transit country determine that a shipment of waste or recyclable material cannot be completed as originally planned, after consent for the shipment was provided, but before delivery to the destination facility. In these situations, the Basel Convention requires the return of these shipments to the country of export if arrangements cannot be made for another facility to treat the waste or recyclable material. Background The Basel Convention was adopted in 1989 to respond to growing global concerns about hazardous waste management. The Convention, ratified by 183 countries, including Canada in 1992, covers wastes and recyclable materials defined as “hazardous wastes” based on their origin and/or composition and their hazard characteristics, as well as “other wastes,” defined as household wastes and residues arising from the incineration of household wastes. Under the Basel Convention, a country must not export hazardous waste or other waste without first obtaining the consent of the importing and transit countries. In addition, there are requirements for the country of export to take back any shipment of waste that cannot be completed as planned. In Canada, the responsibility for managing and reducing waste is shared among federal, provincial, territorial and municipal governments. Municipal governments manage the collection, recycling, composting, and disposal of household waste, while provincial and territorial authorities approve and monitor waste management facilities and operations. The federal government controls international and interprovincial movements of hazardous waste and hazardous recyclable material, as well as releases of toxic substances. The Regulations, which came into force in 2005 and were made under the Canadian Environmental Protection Act, 1999 (CEPA), are the primary tool by which Canada meets its obligations under the Basel Convention. The Regulations define “hazardous waste” and “hazardous recyclable material” and establish a permitting regime to control and track their transboundary movements between Canada and other countries. It is through this permitting process that Canada obtains consent from the importing and transit countries. In 2015, Canada exported approximately 516 000 metric tons of hazardous waste and hazardous recyclable material. Approximately 98% of these exports were destined for the United States, with the remaining 2% exported to Belgium, Germany, South Korea and Mexico. In the same year, 368 000 metric tons of hazardous waste and hazardous recyclable material were imported into Canada, with more than 99% originating from the United States. Objectives The objective of the Regulations Amending the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations (the Amendments) is to strengthen Canada’s ability to meet two of its Basel obligations: the obligation to seek the consent of importing and transit countries for any export from Canada of waste or recyclable material subject to the Basel Convention, including household waste; and the obligation to take or send back shipments that cannot be completed as planned. Description The Amendments will expand what is captured as “hazardous” under the Regulations. Waste and recyclable material, including those collected from households, will be considered hazardous for the purposes of export if they are defined as, or considered to be, “hazardous” under the legislation of the importing country or a transit country; their importation is prohibited under the legislation of the importing country; or they are one of the “hazardous wastes” or “other wastes” in the Basel Convention and the importing country is a party to the Basel Convention. A Canadian exporter will be required to notify the Department and obtain a permit prior to any export of the waste or recyclable material, and to meet all other requirements of the Regulations (insurance, tracking shipments, obtaining confirmation of disposal or recycling, etc.). The Amendments will also add new provisions to address shipments of waste or recyclable material for which consent was provided by the importing and transit countries and a permit issued, but that could not be completed as planned. These include provisions that require the return of shipments exported in accordance with a permit that are not accepted by the authorities of the importing country or a transit country, or of shipments imported in accordance with a permit that are not accepted by Canada, when arrangements for an alternate destination facility cannot be made, and establish a period of 90 days (or another period agreed to by Canada and the country of export, transit or import, as applicable) following the non-acceptance of a shipment, during which the shipment must be returned or arrangements made with an alternate facility, consistent with the requirements under the Basel Convention. All requirements for returning or making alternate arrangements will apply in the event the shipment is not accepted by the importing country or a transit country (insurance, tracking the returned shipment, etc.). Furthermore, the Amendments remove the requirement for the Canadian exporter or importer to inform the authorities of the foreign country when an authorized facility refuses the shipment. They also add a requirement for the Canadian exporter to receive confirmation from the Minister of the Environment that the authorities of the country of import or transit, as applicable, have approved the disposal or recycling at the alternate facility. The Amendments also include a number of minor changes to align the French and English texts and to ensure accurate references to the definitions of “hazardous waste” and “hazardous recyclable material,” as well as to the conditions of export or import. Following publication in the Canada Gazette, Part I, some minor changes were also made to clarify and correct references relating to waste identification codes, as well as to respond to comments received. “One-for-One” Rule The “One-for-One” Rule applies to the Amendments, as there are incremental administrative costs to business. As a result of the Amendments, an estimated six newly regulated small businesses will be required to submit notices to the Minister once a year, before any export of waste and recyclable material takes place, and to report information on these exports. Also, it is estimated that six carriers will be subject to tracking requirements of the Regulations as a result of the Amendments. The total annualized administrative costs for newly regulated businesses to comply with the regulatory requirements over a 10-year time frame will be approximately $594 for all stakeholders (or $50 per business, $95 per exporter and $7 per carrier). (see footnote 3) The administrative activities, and associated assumptions, include the following: Becoming familiar with the information requirements of the Regulations (6 exporters × 4 hours by a manager × 1 time per year at $46/hour, and 6 carriers × 0.17 hour by a transport or equipment operator × 1 time per year at $28/hour); Undertaking notification — Applying for permits under the Regulations (6 exporters × 0.92 hour by a manager × 1 time per year at $46/hour); Providing copies of contracts with notifications to the Department (6 exporters × 0.08 hour by a clerk × 1 time per year at $25/hour); Completing the movement document required under the Regulations (6 exporters × 0.92 hour × 2 times per year at a Canadian average $29/hour, and 6 carriers × 0.17 hour by a transport or equipment operator × 2 times per year at $28/hour); and Confirming disposal (6 exporters × 0.08 hour by a clerk × 2 times per year at $25/hour). Small business lens The Amendments will increase the administrative burden of approximately six small businesses that are expected to have fewer than 100 employees. However, the total cost of the Amendments will be less than one million dollars, and the additional costs to small businesses will not be disproportionately high (about $7,200 per business per year). The small business lens therefore does not apply to the Amendments. Exporters, which are expected to be small businesses, will need to fulfill the administrative requirements as mentioned above in the “‘One-for-One’ Rule” section ($95 per business per year), as well as purchase liability insurance ($6,900 per business per year) and develop contracts ($200 per business per year). Consultation Prior to publication in Part I of the Canada Gazette, consultations were held, in November 2015, with the regulated community, as well as other stakeholders that may be implicated in exports of waste or recyclable materials from households. A discussion document describing the proposed Amendments and the estimated administrative and compliance costs for businesses affected by the proposed Amendments was sent to more than 800 stakeholders. Comments were received from nine stakeholders, including municipalities, provinces, and industry. Overall, there was general support for the proposed Amendments, and no major concerns were raised. Comments on the proposal to consider certain wastes and recyclable materials to be hazardous for the purposes of export suggested aligning the provisions with those of the Basel Convention, including using the relevant codes for waste collected from households. The Department agrees and the new provisions have been aligned with the definitions of “hazardous wastes” and “other wastes” in the Basel Convention. With respect to returning a shipment that is refused or not accepted, a stakeholder suggested that the return and disposal or recycling should occur within 90 days. The Department agrees that such a return should occur within the 90 days or another agreed-upon period, to better align with the requirements of the Basel Convention. Comments were also received regarding potential delays in the issuance of permits as a result of an increased number of notices that may need to be reviewed by the Department. An increased departmental workload has been considered in planning for effective implementation of the Amendments. There was also a comment that the costs of the proposed Amendments may have been underestimated. This comment was taken into consideration in the cost estimates for the Amendments. Following publication of the Amendments in Part I of the Canada Gazette on April 2, 2016, a notice was sent to potential stakeholders to raise awareness of the publication and invite comments during the 60-day public review period. The Department received questions and comments from seven stakeholders including industry, provinces and other federal departments. A summary of the comments and how they are addressed in the Amendments is provided below. Comment: Some stakeholders wanted to know whether or not exports and imports of a specific type of waste or recyclable material to and from the United States would be affected by the Amendments. Response: The Department has responded to these stakeholders. When exports and imports are between Canada and any country, such as the United States, that is not a party to the Basel Convention, the Amendments will not affect those shipments. Comment: A comment was made regarding the flexibility and timing of information submitted to customs offices. Response: The Department has considered these comments and, therefore, subparagraphs 9(l)(ii), 16(k)(ii) and 22(i)(ii) of the Regulations have been amended by replacing the words “deposited at the customs office” with the words “provided to the customs office” to allow for flexibility in the manner and timing for the submission of information to customs offices. There were also comments related to other aspects of the export and import of waste and recyclable material that were either not directly related to the proposed Amendments or outside of their scope. The Department recognizes comments that pertain more generally to Canada’s waste and recyclable material export and import regulatory regime, acknowledges opportunities for additional improvements to this regime, and will consider these comments and opportunities in future regulatory reviews. For example, Comment: One stakeholder raised concerns regarding registration numbers for exporters and carriers which are needed for notification under the Regulations. These numbers are assigned by provincial and territorial authorities on the basis of their legislation and, in some cases, there is no requirement under provincial or territorial legislation for an exporter or a carrier to obtain a registration number. Response: The Department is aware of the situations identified in the above comment and has been addressing them administratively when required. The provisions of the Regulations that list the information required on the notification for the exporter, importer or carrier are not among the notification provisions being amended. Therefore, this comment was outside the scope of these Amendments. Comment: With respect to the provisions allowing for alternate arrangements to be made within 90 days or another agreed-upon period, another stakeholder suggested that this period also include the disposal of the hazardous waste or the recycling of the hazardous recyclable material. Response: The issue raised pertains to provisions of the Regulations that set the time period for completing the disposal of the hazardous waste or recycling of the hazardous recyclable material. They are not part of the return provisions being amended. Therefore, this comment is outside the scope of these Amendments. Rationale The definitions of “hazardous waste” and “hazardous recyclable material” in the Regulations do not fully encompass all wastes and recyclable materials that are subject to the Basel Convention. The Amendments will strengthen Canada’s ability to seek the consent of importing and transit countries to any export from Canada of waste or recyclable material that is subject to the Basel Convention and help avoid the risk of exporting waste or recyclable material that would not be accepted. Approximately 155 Canadian exporters and importers of hazardous waste and hazardous recyclable materials are subject to the current Regulations. Additional Canadian companies that could be affected by the provisions in the Amendments related to what is captured as hazardous under the Regulations include those that export waste or recyclable material that is collected from households to countries other than the United States; and export waste or recyclable material that is not considered hazardous in Canada (e.g. water-based paint), but is considered hazardous in another country. About 98% of all waste and recyclable material that is exported from or imported into Canada is traded with the United States. Since the United States does not prohibit or control imports of household waste or recyclable materials, and its definition of “hazardous waste” is already in line with the definitions of “hazardous waste” and “hazardous recyclable material” under the Regulations, the Amendments will not have an impact on Canadian companies that export these types of waste and materials to the United States. Only a small number, an estimated six additional Canadian companies and six carriers, is expected to be affected by the Amendments. These exporters will be required to notify the Minister of planned transboundary movements in order to obtain a permit to comply with the tracking requirements of the Regulations for each shipment, to purchase liability insurance ($6,900 per business per year) and to develop contracts ($200 per business per year). Carriers will be required to complete movement documents to track their shipments. Based on current information, it is estimated that six Canadian exporters will submit six notices for 12 shipments per year. Additionally, the six carriers that will transport the 12 shipments of waste or recyclable material will need to complete a portion of the movement document. Given that the provisions in the Amendments related to what is captured as hazardous under the Regulations will ensure that these exports are made only with the consent of the importing and transit countries, it is not anticipated that there would be costs associated with returns, except under exceptional circumstances. The total annualized cost of the Amendments is estimated to be about $43,000. It is expected that the Amendments will result in 1 000 metric tonnes of additional waste and recyclable material being controlled under the Regulations each year. This is a small amount (less than 0.2%) of the total volume of hazardous waste and hazardous recyclable material exported each year. The provisions in the Amendments related to what is captured as hazardous under the Regulations will only affect exports. There will be no implications for imports into Canada. The provisions in the Amendments requiring the return of a shipment if a country withdraws its consent are not expected to result in any additional returns. Currently, only a small number of shipments of hazardous waste and hazardous recyclable material that are exported in accordance with a permit are not accepted (less than 1%). As well, a withdrawal of consent has never occurred for the above-mentioned exports and only once for imports of hazardous waste and hazardous recyclable material since the Regulations came into effect in 2005. Strategic environmental assessment As required by the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan was conducted and concluded that there will be no expected important environmental effects, either positive or negative; accordingly, a strategic environmental assessment is not required. Implementation, enforcement and service standards The Amendments are expected to apply to potential new regulatees that will not have been previously subject to the Regulations, and may not be very familiar with the requirements of the Basel Convention. As a result, significant compliance promotion efforts will be undertaken immediately prior to and following final publication of the Amendments. Compliance promotion materials and activities will be focused on highlighting changes for existing permit holders, for potential new regulated companies and for other key stakeholders such as municipalities, transportation companies, and trade associations. Compliance promotion tools will include a combination of the following: Frequently Asked Questions, information sheets, Web site notifications, leveraging communication opportunities with trade associations, and direct mail-outs to Canadian export companies. It is anticipated that the Amendments will not have an impact on current service standards and performance indicators for issuing export permits under the Regulations. (see footnote 4) The Department’s Compliance and Enforcement Policy (see footnote 5) for CEPA will be applied when compliance with the Amendments is verified. This policy sets out the range of possible responses to alleged violations, including warnings, directions in case of release, environmental protection compliance orders, ticketing, ministerial orders, injunctions, prosecution and environmental protection alternative measures (which are an alternative to a court prosecution after the laying of charges for a CEPA violation). In addition, the policy explains when the Department will resort to civil suits by the Crown for cost recovery. When, following an inspection or an investigation, an enforcement officer discovers an alleged violation, the officer will choose the appropriate enforcement action based on the following factors: Nature of the alleged violation: This includes 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 and requirements of the Act. Effectiveness in achieving the desired result with the alleged violator: The desired result is compliance within the shortest possible time with no further repetition of the violation. Factors to be considered include the violator’s history of compliance with the Act, willingness to cooperate with enforcement officers, and evidence of corrective action already taken. Consistency in enforcement: Enforcement officers will consider how similar situations have been handled in determining the measures to be taken to enforce the Act. Contacts Gwen Goodier Director Waste Reduction and Management Division Environment and Climate Change Canada Place Vincent Massey 351 Saint-Joseph Boulevard, Room 09-062 Gatineau, Quebec K1A 0H3 Email: [email protected] Yves Bourassa Director Regulatory Analysis and Valuation Division Environment and Climate Change Canada Fontaine Building 200 Sacré-Cœur Boulevard, Room 1084 Gatineau, Quebec K1A 0H3 Email: [email protected] Footnote a S.C. 2004, c. 15, s. 31 Footnote b S.C. 1999, c. 33 Footnote c S.C. 1999, c. 33 Footnote 1 SOR/2005-149 Footnote 2 www.basel.int Footnote 3 Estimates were developed using Treasury Board of Canada Secretariat guidance on the Standard Cost Model provided in Controlling Administrative Burden That Regulations Impose on Business: Guide for the ‘One-for-One’ Rule, a 7% discount rate, and 2012 constant dollars. Footnote 4 These services standards are available at http://www.ec.gc.ca/gdd-mw/default.asp?lang=En&n=5A86A160-1. Footnote 5 Environment and Climate Change Canada’s Compliance and Enforcement Policy for CEPA is available at www.ec.gc.ca/lcpe-cepa/default.asp?lang=En&n=5082BFBE-1.
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