The Building Canada Strong Act, Bill C-39, is what Prime Minister Mark Carney calls the most consequential economic legislation of this Parliament. Ottawa says it will get major projects built faster without lowering standards.
Critics, including environmental groups, unions and some First Nations leaders, say it hands ministers sweeping new powers at the expense of nature, workers’ right to strike and Indigenous consultation. At more than 240 pages, it amends 19 laws plus four regulations. It also repeals the Shipping Conferences Exemption Act, which shielded ocean shipping lines from parts of competition law, and creates the Enabling Digital Trade Act, which lets companies use electronic trade documents instead of paper.
The bill is still being debated in the House of Commons, where it passed second reading and was referred to a special Legislative Committee on Bill C-39. It must pass a third reading and clear the Senate before it becomes law. Here’s what it would change.
Ministerial powers
One of the most contentious aspects of Bill C-39 is that it grants cabinet ministers many new powers in the name of speeding up approvals.
For instance, under the current Impact Assessment Act, several ministers have a role in issuing permits under various federal laws. Under C-39, the Minister of Environment issues a single decision covering all required permits, after consulting with cabinet colleagues.
The Minister of Environment will also be empowered to approve some site preparation work on a project before the entire assessment process is complete. They can also add, remove, or amend conditions that had previously been imposed on a project.
Bill C-39 would also add this power to change past environmental conditions to the Building Canada Act, or C-5, which was approved by Parliament last year to fast-track projects deemed by cabinet to be in the national interest.
Bill C-39 also expands the scope of C-5 powers by allowing the government to prioritize projects in regions of national interest. The bill itself provides few details as to how these regions would be defined and how such designations would work in practice. Nor does it detail how much work on a project can proceed before the assessment process is complete.
Bill C-39 also removes a sunset clause in Bill C-5 that limited to five years cabinet’s powers to designate projects as being in the national interest.
Another section of the latest bill gives the Minister of Transport expanded powers related to security clearances at airports and ports. The government said the existing program is more than 40 years old and the new system is needed to consider broader risks, such as organized crime or suspicious activity.
Many environmental organizations strongly oppose C-39, saying it effectively removes a wide-range of existing protections for the environment. “We’re going to explicitly allow the regulatory regime under a variety of acts to be overridden at ministerial discretion, and the implications of this for the public, I think, are going to be dramatic,” said Tim Gray, executive director of Environmental Defence, in an interview.
Mr. Gray said some environmental reviews involve studying species migration patterns that can’t be properly analyzed in a single year. “So you will just make decisions without knowing what the consequences are going to be, and just hope for the best,” he said. Environmental Defense is also opposed to the bill’s removal of the sunset clause on Bill C-5. “I don’t think the bill should pass at all. But a sunset clause is better than no sunset clause,” he said.
Industry groups, including the Canadian Association of Petroleum Producers, have welcomed the legislation. CAPP President and CEO Lisa Baiton said in a statement that her organization “supports the Government of Canada’s steps forward to streamline approvals processes, reduce regulatory duplication, and recognize provincial jurisdiction in project approvals.”
Claire Seaborn, a lawyer with Torys and former chief of staff to former Liberal Natural Resources Minister Jonathan Wilkinson, recently co-authored a technical analysis of the bill. In an interview, she said some of the commentary on the government’s one year timeline ignores the point that there is an additional year-and-a-half of preparatory work by the proponent of a project that must take place before the clock begins on the government review.
“I think [the legislation] walks a careful line, and I think it’s kept a lot of the nuts and bolts of the federal process intact,” she said. “We’re getting through those processes more quickly, but I don’t think that necessarily means that those corners are being cut or that we’re losing on quality.”
– Bill Curry
Federal labour law
The federal government’s Building Canada Strong Act also proposes substantial amendments to the Canada Labour Code – changes that have sparked controversy amongst many in the labour movement who feel the propositions are heavy handed.
Broadly speaking, Ottawa intends that these changes do three things to federal labour law: modernize the collective bargaining process such that negotiations start and end at the bargaining table; clarify how and when the Minister of Jobs and Families (formerly known as the Minister of Labour) can intervene in a labour dispute; and strengthen worker protections.
However, the Canada Labour Code does not govern worker rights across the country; it dictates labour laws for 1.4 million federal workers. They include employees in the federal public service, and those in federally-regulated industries such as telecommunications and transportation. But labour experts are concerned that there could be a trickle-down effect of these changes of the Code to provincial labour laws, thus potentially impacting a far larger group of workers.
There are more than 10 proposed changes to the various clauses in the Code. But by far, the most controversial are additions to Section 107, a clause that empowers the minister to “take any measure” to end a strike or a lockout of workers stemming from a labour dispute.
Bill C-39 leaves the existing language of the clause in place, but adds criteria that the minister must consider before enacting Section 107. Specifically, before invoking the clause, the minister needs to evaluate the contents of a special mediator’s report on a labour dispute. If the minister is of the opinion that a strike or lockout “may adversely affect the national interest,” the minister can invoke the clause.
Ottawa’s position on the changes to Section 107, including the creation of a special mediator role, is that they add guardrails to how and when a minister intervenes in a labour dispute. Unions have, for years, been critical of Ottawa’s repeated use of section 107 to quell strikes by directing the federal labour board to impose arbitration of a contract, solely on the judgment of the minister of labour. The proposed changes are, to the federal government, a way of addressing this criticism.
But unions are now saying that these changes effectively entrench Section 107 in the labour code, instead of removing it altogether (which is what they had pushed for). In particular, they say that the changes will dilute federal employees’ right to strike, because the government now has expanded power to decide if a particular strike impacts the “national interest.” Unions also say that the inclusion of that language alters the dynamic at the bargaining table. If employers go into a negotiation knowing that a group of workers has a lessened right to strike, it changes the calculation of their offer, unions say.
According to the Canadian Labour Congress, Bill C-39, if passed, would give the Canadian government the broadest strike intervention powers in the G7, because the minister retains the final say on whether or not to quash a strike.
“The legislation does give the minister huge power to order an end to a strike. And the way in which it is worded being ‘in the national interest’ means there is not much of a restriction on how that power will be used,” said Eric Tucker, professor emeritus of law at York University’s Osgoode Hall Law School.
– Vanmala Subramaniam
Canada Energy Regulator mandate
Another significant change under Bill C-39 is how much it would broaden the mandate of the Canada Energy Regulator.
The new powers granted to the CER would be two-pronged: Making it the single assessor for pipeline projects, and empowering it to make final approval decisions for conduits that are less than 300 kilometres long. (In the case of longer pipelines, the CER would prepare a report to the federal government, which issues or dismisses a project certificate.)
That’s not to say the CER has carte blanche when it comes to setting the conditions under which pipelines can be built.
Under a provision in the bill, the regulator will have to consider the technical, economic and practical feasibility of any conditions it wants to impose, and a proponent can challenge any of those terms that it believes are technically or economically unfeasible. A recent analysis from Dentons law firm said this new requirement “should reduce the risk of impractical or unworkable conditions being imposed on pipeline projects.”
Making the CER the lead agency responsible for co-ordinating the entire approval process “has the potential to really impact timelines,” said Gitane De Silva, the executive director of the Peter Lougheed School of Politics and Democracy.
“In the past you would have had the CER responsible for the hearing process, then making a recommendation to cabinet, then moving forward and overseeing the construction. But now they can actually make sure that fisheries permits, navigable water permits and species at risk permits are being issued in a timely way,” she said in an interview.
Ms. De Silva, who served as the regulator’s CEO from 2020 to 2023, said the ability to co-ordinate permitting will make the CER’s life much easier.
“When I was CEO, I would have to pick up the phone and call another government department and say, ‘Your permit on X is due by this date,’ and ‘Your decision on the permit application is due by this date, and if you don’t make that decision the company is going to lose a month of construction time,’” she said. “Now there’ll be that oversight from the outset.”
Consternation around the changes has centred on the one-year timeline, rather than the CER taking the reins of the approval process.
Energy and Natural Resources Minster Tim Hodgson said in a recent interview he’s confident that the CER can handle its extended powers, particularly because the regulator has been involved in every pipeline approval process since 2019.
It is a “very competent regulator,” he said, adding that he is “quite confident” that the agency is up to the challenge of a broadened mandate.
– Emma Graney
Nuclear power
Bill C-39 would assign responsibility for conducting federal impact assessments of nuclear and uranium projects entirely to the Canadian Nuclear Safety Commission, a federal regulator which already supervises nuclear activities. (Currently, it works alongside the Impact Assessment Agency of Canada to conduct joint impact assessments.) The existing Impact Assessment Act includes a time limit of 600 days for such reviews.
The impetus to speed up isn’t new: Under a 2019 agreement, the CNSC and IAAC committed to avoiding “unnecessary delays or duplication of effort” and targeted a 300-day time limit. Bill C-39 preserves that; the clock starts ticking once the proponent has submitted finalized studies and requested information.
In a recent commentary, lawyers from the law firm Gowling WLG concluded this stipulation does not mean less work. “Proponents will need greater design maturity, earlier environmental studies, and earlier Indigenous engagement before they enter the formal process,” they wrote. “Faster decisions will require work that is better co-ordinated and front-loaded.”
Dean Haslip, a vice president with the CNSC, said impact assessments will be completed concurrently with the first license often sought for a nuclear project, known as a license to prepare site. However, proponents will still need other licenses – including one to construct the plant and another to operate it, and the timelines for those processes remain unaffected by C-39.
Dr. Haslip said the CNSC is “doing some hiring” in preparation for its new responsibilities. But the organization is already responsible for reviewing safety, security and environmental protections associated with nuclear projects, he added, “so it’s not a question of the CNSC needing to develop new capabilities.”
Supporters of the rule changes include the Saskatchewan government, which asserted in a document in late September that “a single-regulator model would improve clarity for proponents, but it would not remove the information, assessment or licensing requirements that a nuclear proponent must satisfy.”
Theresa McClenaghan, executive director of the Canadian Environmental Law Association, said in an interview that by assigning impact assessments to the CNSC alone, Bill C-39 effectively returns to how things were done prior to 2019 – an arrangement her organization opposed.
“The CNSC is a captured regulator,” she said. “They’re very accustomed to acceding to what the industry is asking for. They don’t have a track record of giving the same weight and attention to public concerns.”
Several nuclear projects are at early stages in impact assessments, including two proposed large nuclear plants in Ontario and one in Alberta.
Bruce Power is planning a new block of up to four reactors known as Bruce C. Spokesperson Maggie Tieman wrote in a statement that the CNSC was “uniquely positioned to oversee nuclear projects.” She noted that C-39 provides for a transition intended to preserve progress already made while allowing proponents to benefit from new efficiencies.
Also being assessed is a proposal to store radioactive spent nuclear fuel in an underground facility known as a Deep Geological Repository. The Nuclear Waste Management Organization plans to build one near Ignace, in northwestern Ontario. That project was referred to the Major Projects Office in June.
Canada’s proposed reforms are less aggressive than those pursued in the United States, where the Trump Administration has instigated wholesale revision of the Nuclear Regulatory Commission’s practices. Among them: The NRC has been instructed to finish reviews of new reactor designs within 18 months. And in an effort to pare down on what the Trump Administration regards as outdated regulations, it has also been ordered incorporate sunset provisions into all of its regulations concerning nuclear power so that they expire automatically within five years unless the NRC actively extends them.
– Matthew McClearn
Species at risk, fisheries
Bill C-39 gives Canada’s laws protecting fish, endangered species and their habitat new conservation tools, but falls short of what environmental groups say is needed to reverse species declines.
“We’re in a nature deficit, and we can’t let projects go forward at just a no net loss rate,” said Amanda Reed, interim chief executive officer of the Canadian Wildlife Federation, in an interview.
In May, Ottawa proposed letting cabinet exempt projects from a key rule in the Species at Risk Act: that no permit can be issued if it would jeopardize a species’ survival. After pushback from groups including the federation, the government left the proposal out of C-39.
On Wednesday, a coalition including West Coast Environmental Law, the Canadian Parks and Wilderness Society and the union representing federal scientists called on Ottawa to scrap C-39. The groups said the Building Canada Act already lets cabinet exempt national interest projects from the Species at Risk Act, while job cuts at Fisheries and Oceans thin the ranks of scientists who assess threats and plan recovery.
The wildlife federation, by contrast, welcomed parts of the bill – particularly Fisheries Act changes that allow companies to buy habitat credits from third parties that restore habitat in advance, or pay fees into a federal fund. But Bill C-39 stops short of what the federation calls “nature positive”: requiring companies that damage fish habitat to restore more than they destroy.
Today, Fisheries and Oceans requires companies that harm fish habitat to build replacement habitat, a practice known as offsetting, and to monitor it and post a financial guarantee.
“It’s done on a case-by-case basis, and it’s not super effective,” Ms. Reed said, adding that companies are rarely conservation experts. Federal scientists argue that offsets should be at least twice the size of the damage to break even, yet a 2017 study found two-thirds of permits required companies to restore less than they destroyed.
Under the bill, companies could also meet the requirement by buying credits from conservation groups, land trusts or Indigenous organizations that restore habitat in advance, a system called habitat banking. The changes “will provide more tools and reduce red-tape,” Naomi Librach, a spokesperson for Fisheries and Oceans Canada said in a statement.
Fees would apply only to projects the department deems low-risk or to have minor impacts; bigger projects would still have to offset. Fees would go to the Environmental Damages Fund and must go to fish and fish habitat.
But the bill doesn’t limit fees to minor impacts or define them, leaving it to the fisheries minister to determine in regulations. Pooling fees from smaller projects “could support larger, more strategic habitat restoration initiatives that deliver meaningful benefits at an ecosystem scale,” said Ms. Librach.
Under revisions to the Species at Risk Act and Fisheries Act, for major projects, ministers would have to weigh whether conditions protecting fish and listed species are “technically, economically and practically” feasible for companies, a test C-39 adds to five laws.
Regulators already work with companies to make sure conditions are achievable, but the amendments “codify this existing practice into law,” Ms. Librach said. “The objective is not to lower environmental standards.”
“It tips the scale in favour of approval, even when that approval could cause much greater harm,” said Anna Johnston, a staff lawyer with West Coast Environmental Law, in an interview.
Under a “one-window” approach for projects under federal impact assessment, the environment minister, rather than Fisheries and Oceans, would issue fish and species permits along with a project’s approval. Conditions on national interest projects could be loosened, including killer whale protections at the Roberts Bank Terminal 2 port expansion, if it were designated a project of national interest.
Cabinet could also create regions of national interest, which West Coast Environmental Law calls environmental deregulation zones. Ms. Reed sees potential in planning development region by region, but says the details remain unsettled. “We’re making it up as we go,” she said.
The changes are meant to speed up approvals, with decisions on major projects due within a year of a company submitting all required studies. The work before that, including species surveys and consultation with Indigenous nations, “still needs to take as long as it needs to take, and that’s on the developer,” Ms. Reed said.
– Jenn Thornhill Verma
Indigenous consultation
The government is proposing a new Crown Consultation Hub as a centralized federal co-ordinator for federal agencies and departments consulting with Indigenous peoples.
Failed attempts by developers and governments to satisfy constitutional requirements to consult First Nations have led to multiple costly legal cases and other protests that have forced delays and cancellations in the past, most prominently with pipelines.
The hub will be under the umbrella of the Impact Assessment Agency of Canada. It is aimed at spotting and addressing Indigenous concerns early, assisting provincial consultation and providing guidance to federal officials, the government said. It may also set up funding for some consultations with Indigenous groups.
The new body would take the lead, except where the Canada Energy Regulator or the Canadian Nuclear Safety Commission are the sole assessors of projects, or if the project is being co-ordinated by the Transportation Project Office, Northern Projects Management Office, or the Major Projects Office, according to the legislation.
The government says the goal is to streamline consultation efforts, not remove any requirements or add new steps for Indigenous communities as they raise questions about proposed developments.
Under the legislation, project proponents would be required to describe how they will address adverse impacts on Indigenous peoples, set out in section 35 of the constitution.
Some Indigenous leaders have expressed concerns about the impact of shorter approval timeline on the consultation process for major projects on traditional territories, and some have criticized what they say was insufficient consultation in developing the legislation itself.
When Bill C-39 was unveiled in September, Cindy Woodhouse Nepinak, National Chief of the Assembly of First Nations, said consultations on major projects should not be time-limited. “The truth is, any predetermined timeline principally designed to attract investment subordinates the honour of the Crown to commercial imperatives,” she told reporters.
In the Senate on Oct. 6, Senator Brian Francis cited the National Chief’s concerns and asked whether the government would give Indigenous peoples adequate time to propose amendments, and be open to changes aligning the bill with the UN Declaration on the Rights of Indigenous Peoples Act. Steven MacKinnon, the Transport Minister and Government House Leader, said the government received “403 submissions from Indigenous groups, rights holders, stakeholders and others” and held more than 30 meetings with First Nations groups during its consultations. “We will obviously carefully consider all of their feedback and advice,” he said. He did not commit to amendments.
However, proposed changes to the Canadian Energy Regulator Act and the planned rules of the Impact Assessment Act will allow extensions to the 12-month approval timeframe if more Indigenous consultation are needed, the law firm Torys noted in a legal assessment of the legislation. Nevertheless, the firm is advising developers to start their engagements early in light of the accelerated timeline.
Terry Teegee, regional chief of the British Columbia Assembly of First Nations, warned that changes within the legislation, including to the Fisheries Act, will have direct impact on consultation where environmental issues are key to a decision. “There’s been this ongoing issue of management, not only the issues of habitat restoration, or habitat up in the far reaches of many rivers and streams, but also in the oceans, that need to be addressed,” he said in an interview.
Blake, Cassels & Graydon LLP said that it expects legal challenges to the new rules, as was the case with several Ontario First Nations that launched a constitutional challenge to previous legislation, the Building Canada Act, along with a similar provincial act, last year.
That action remains before the Ontario Superior Court of Justice with a hearing expected in the first half of 2027. Kate Kempton, a lawyer with the firm Woodward & Co. LLP, representing the First Nations, said they are considering adding a challenge to aspects of C-39 to the case.
– Jeffrey Jones
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