Treasury Board of Canada Secretariat

Government of Canada Regulatory Policy

Effective date

The present document contains the Regulatory Policy as approved on November 9, 1995. It replaces the 1992 version of this policy and Appendix R to the Treasury Board Contracting Policy.

Policy objective

To ensure that use of the government's regulatory powers results in the greatest net benefit to Canadian society.

Policy statement

Canadians view health, safety, the quality of the environment, and economic and social well-being as important concerns. The government's regulatory activity in these areas is part of its responsibility to serve the public interest.

Ensuring that the public's money is spent wisely is also in the public interest. The government will weigh the benefits of alternatives to regulation, and of alternative regulations, against their cost, and focus resources where they can do the most good.

To these ends, the federal government is committed to working in partnership with industry, labour, interest groups, professional organizations, other governments and interested individuals.

Application

This policy applies to federal regulatory authorities.

Policy requirements[1]

When regulating, regulatory authorities must ensure that

1. they can demonstrate that a problem or risk exists, federal government intervention is justified and regulation is the best alternative.

2. Canadians are consulted, and that they have an opportunity to participate in developing or modifying regulations and regulatory programs.

3. the benefits outweigh the costs to Canadians, their governments and businesses. In particular, when managing risks on behalf of Canadians, regulatory authorities must ensure that the limited resources available to government are used where they do the most good.

4. adverse impacts on the capacity of the economy to generate wealth and employment are minimized and no unnecessary regulatory burden is imposed. In particular, regulatory authorities must ensure that

5. intergovernmental agreements are respected (see Appendix A) and full advantage is taken of opportunities for coordination with other governments and agencies.

6. systems are in place to manage regulatory resources effectively. In particular, regulatory authorities must ensure that

Responsibilities

The Treasury Board Secretariat is responsible for developing and updating the federal regulatory policy and its associated regulatory process management standards. The Secretariat develops advice, guides and training to help regulatory authorities comply with the policy and achieve the management standards. The Secretariat also monitors the performance reviews that regulatory authorities conduct to assess whether the management standards have been met, and reports to the President of the Treasury Board on these reviews.

Regulatory authorities are responsible for developing, maintaining and enforcing regulatory programs that follow the federal regulatory policy and for having regulatory management systems in place that meet the standards. Authorities must review their performance and report to the President of the Treasury Board on whether they have met the management standards.

The Department of Justice is responsible for offering legal advice to regulatory authorities on how best to meet the management standards. For example, the Regulatory Reform Group in the Administrative Law Section provides regulatory authorities with the legal tools and legal opinions on alternative regulatory solutions, harmonization of regulatory requirements, compliance and enforcement techniques, and use of performance and international standards.

This policy is also dependent on the input of Canadians - industry, labour, interest groups, professional organizations, other governments and individuals - into the design and review of regulations and regulatory programs. Canadians have a responsibility, as citizens, to make a reasonable contribution by helping the government develop regulatory programs that will benefit Canadian society as a whole.

Monitoring

The Treasury Board Secretariat will monitor the performance of regulatory authorities and the effectiveness of this policy.

To do this, the Secretariat will rely on existing sources of information, including, where appropriate, the Federal Regulatory Plan, business plans, Treasury Board submissions, major regulatory initiatives submitted for Cabinet consideration, proposals going through the regulatory process, formal program evaluations, the results of internal audits and government reviews.

In addition, where appropriate, the Secretariat will use the work of third parties (e.g. the Office of the Auditor General, private-sector working groups or academics) to assist in determining the degree of compliance with this policy.

References

Authority

The policy is issued under the authority of the Financial Administration Act, section 7(1)(a).

Publications

See the notes to Appendix B.

Enquiries

Enquiries about this policy should be directed to

Regulatory Affairs Directorate
Treasury Board Secretariat
Facsimile: (613) 957-7875
Internet: RADDAR@tbs-cts.x400.gc.ca

APPENDIX A : TRADE AGREEMENT OBLIGATIONS FOR REGULATORS

Requirements

When developing or changing technical regulations, federal regulatory authorities must

1. ensure that regulatory officials are aware of their general obligations as laid out in the World Trade Organization (WTO) Agreement on Technical Barriers to Trade (TBT), the North American Free Trade Agreement (NAFTA) Articles on Technical Barriers to Trade (Chapter 9), and Article 405 of the Canadian Agreement on Internal Trade (AIT);

2. ensure that regulatory officials are aware of other obligations agreed to by the Government of Canada, such as the provisions of the WTO Agreement and NAFTA addressing sanitary and phytosanitary measures (SPS), the AIT provisions relating to specific sectors of the economy, and other accords entered into by Canada such as the Safety of Life At Sea Convention of the International Maritime Organization; and

3. adhere to those procedural and substantive obligations agreed to by the Government of Canada through intergovernmental agreements.

In particular, for technical regulations[2] that affect trade, federal regulatory authorities must

4. with regard to notification

5. with regard to performance-oriented requirements

6. with regard to international standards

7. with regard to enforcement

8. with regard to complaint resolution

Responsibilities

The Department of Foreign Affairs and International Trade (DFAIT) is responsible for coordinating the implementation of the WTO and NAFTA Technical Barriers to Trade agreements by federal departments and agencies and for making arrangements to operate the WTO and NAFTA Enquiry Point for the TBT and SPS agreements.

Agriculture and Agri-food Canada has the main responsibility for coordinating the implementation of the WTO and NAFTA SPS agreements by federal departments and agencies, and by provincial and regional bodies.

Industry Canada (IC) is responsible for representing the federal government in the ongoing intergovernmental process under the Agreement on Internal Trade and for coordinating implementation of the Agreement by federal departments and agencies.

The Department of Justice is responsible for advising regulatory authorities on their legal obligations under the above agreements and on how to draft technical regulations so as to comply with them.

Monitoring

Treasury Board Secretariat reviews all regulatory proposals for adherence to Treasury Board Policy. DFAIT or IC are notified if there are concerns regarding possible violations of trade agreement obligations.

Enquiries

Enquiries about NAFTA or WTO should be directed to

Director, Technical Barriers to Trade (EAS)

Department of Foreign Affairs and International Trade

Enquiries about the Agreement on Internal Trade should be directed to

Director General, Internal Trade Consultations

and Federal/Provincial Relations

Industry Canada

Appendix B : Regulatory process Management Standards

Application

These standards apply to federal regulatory authorities. The departments listed in Annex A will be expected to have systems in place that meet these standards by December 31, 1996. Remaining departments and agencies responsible for regulatory requirements will be expected to do the same by December 31, 1997.

Requirements

General responsibility

Federal regulatory authorities must meet the Regulatory Process Management Standards set out below.[3] It is the responsibility of regulatory authorities to develop and maintain a system to manage the regulatory process that meets the standards, and to document clearly how they are met for each proposal to create or amend regulations.[4]

Accountability

The departments listed in Annex A are responsible for arranging reviews to ensure that they comply with these standards. They must send a copy of the review report to the President of the Treasury Board. A first review must be carried out within, at most, three years of the implementation of these new standards. For other regulatory authorities, and for second and subsequent reviews at the main regulatory departments, a schedule for reviews must be prepared based on the significance of and risk associated with non-compliance with the Regulatory Process Management Standards.[5] A guide for reviewing regulatory processes is forthcoming.[6]

The Regulatory Process Management Standards

Policy Development and Analysis

Consultation

Regulatory authorities proposing new regulatory requirements, or changes to existing regulatory requirements, must carry out timely and thorough consultations with interested parties. The consultation effort should be proportional to the magnitude of the impact of the proposed regulatory change. Notice of proposed regulations and amendments must be given so that there is time to make changes and to take comments from consultees into account.[19][20]

Regulatory authorities must clearly set out the processes they use to allow interested parties to express their opinions and provide input. In particular, authorities must be able to identify and contact interested stakeholders, including, where appropriate, representatives from public interest, labour and consumer groups. If stakeholder groups indicate a preference for a particular consultation mechanism, they should be accommodated, time and resources permitting. Consultation efforts should be coordinated between authorities to reduce duplication and burden on stakeholders.

Regulatory authorities should consider using an iterative system to obtain feedback on the problem, on alternative solutions and, later, on the preferred solution.

Consultations should begin as early as possible in order to get stakeholder input on the definition of the problem, as well as on proposed solutions.

Communications

Regulatory authorities creating new regulatory requirements must tell stakeholders about the proposal in simple, clear, complete and concise language that the general public can easily understand.

New regulations must be written in plain language that regulatees can easily understand.[21]

New regulations and changes to existing regulations, as well as material incorporated by reference, must be well publicized and easily accessible to stakeholders.

When a Regulatory Impact Analysis Statement is required, the document must

Training

Regulatory authorities must ensure their personnel are competent to carry out the requirements of the Regulatory Process Management Standards.

Documentation

Regulatory authorities must document their regulatory policy and processes, including the responsibilities, authorities and interrelationships of personnel who manage, carry out and review regulatory programs.

The process followed to develop each new or changed regulation must be documented. The documentation should include, but not be limited to, a description of the problem, alternative solutions, the risks involved, the reasons for regulating, the consultation process used and the benefit-cost analysis.

ANNEX A: DEPARTMENTS THAT MUST, BY DECEMBER 31, 1996, HAVE SYSTEMS THAT MEET THE STANDARDS, AND THAT MUST ARRANGE A FIRST INTERNAL REVIEW BY DECEMBER 31, 1999

Agriculture and Agri-food

Environment

Health

Industry

Transport

Revenue

Fisheries and Oceans

ANNEX B: COMPLAINT RESOLUTION PRINCIPLES

The objective of these principles is to ensure that the complaint resolution mechanisms of federal regulatory authorities are simple, clear and well known.

Such complaint resolution mechanisms should facilitate the early resolution of complaints about program implementation, and increase client satisfaction with federal government regulatory programs and services. Complaint resolution mechanisms that provide information to management will not only make it easier for departments and agencies to identify areas where they could improve government services, but will also result in improved and more cost-effective regulatory program and service delivery.[23]

Principles

Federal regulatory authorities must have complaint resolution mechanisms that


Notes

[1] When exceptional circumstances affect a regulatory authority's ability to fulfil a policy requirement, the regulatory authority must justify and document the exception. Return

[2] "technical regulation means a document which lays down goods' characteristics or their related processes and production methods, or services' characteristics or their related operating methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a good, process, or production or operating method;" North American Free Trade Agreement, 1992, Article 915. Return

[3] All mandatory requirements are set out in this policy. Publications referenced in these notes are advisory documents that offer additional information for regulators. Return

[4] OECD Reference Checklist for Regulatory Decision-making, OECD, Paris, France, 1995. Return

[5] Reviewing Regulatory Programs, Treasury Board Secretariat, Draft, 1995. Return

[6] Regulatory Process Management Standards - Implementation and Audit Guide, Treasury Board Secretariat, forthcoming. Return

[7] Risk Analysis Requirements and Guidelines, CAN/CSA-Q634-M91, Canadian Standards Association, 1991. Return

[8] Technical Guide to Regulatory Impact Analysis, Stanbury and Vertinsky, Treasury Board Secretariat, 1994. Return

[9] Benefit-Cost Analysis Guide for Regulatory Programs, Treasury Board Secretariat, 1995. Return

[10] Designing Regulatory Laws that Work, Department of Justice, 1994. Return

[11] Assessing Regulatory Alternatives, Treasury Board Secretariat, 1994. Return

[12] A "Workplace Impact Test" is to be developed by Human Resources Development Canada and Treasury Board Secretariat, in partnership with labour organizations. Return

[13] See Benefit-Cost Analysis Guide for Regulatory Programs, Chapter 7: Consumer Impact Assessment. Return

[14] Major proposals are those with a present value of more than $50 million and those with a present value of between $100,000 and $50 million but with a low degree of public acceptance. Return

[15] Using the Business Impact Test Effectively, Treasury Board Secretariat, forthcoming. Return

[16] Regulatory Cooperation between Governments, Treasury Board Secretariat, 1994. Return

[17] Framework for Managing Regulatory Programs, Treasury Board Secretariat, 1992. Return

[18] A Guide to Effective Complaint Management, Treasury Board Secretariat, forthcoming. Return

[19] Consultation Guidelines for Managers in the Public Service, Privy Council Office, 1992. Return

[20] Practical Guide to Public Consultations, Privy Council Office, 1993. Return

[21] Plain Language Guidelines for Legislative Drafting, Treasury Board Secretariat and Department of Justice, forthcoming. Return

[22] Regulatory Impact Analysis Statement: Writer's Guide, Treasury Board Secretariat, 1992. Return

[23] A Guide to Effective Complaint Management, Treasury Board Secretariat, forthcoming. Return


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