Research Branch BILL C-6: AN ACT TO AMEND THE YUKON QUARTZ MINING ACT AND THE YUKON PLACER MINING ACT. David Johansen. Law and Government Division

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1 Legislative Summary LS-228E BILL C-6: AN ACT TO AMEND THE YUKON QUARTZ MINING ACT AND THE YUKON PLACER MINING ACT David Johansen Law and Government Division 18 March 1996 Library of Parliament Bibliotheque du Parlement Research Branch

2 LEGISLATIVE HISTORY OF BILL C-6 II IIOIJSE OF COMMONS Ii II SENATE Bill Stage Date Bill Stage Date First Reading: 4 March 1996 First Reading: 21 October 1996 Second Reading: 4 June 1996 Second Reading: 23 October 1996 Committee Report: 25 September 1996 Committee Report: 5 November 1996 Report Stage: 11 October 1996 Report Stage: Third Reading: 21 October Third Reading: 6 November 1996 Royal Assent: 28 November 1996 Statutes ofcanada 1996, c.27 N.B. Any substantive changes in this Legislative Summary which have been made since the preceding issue are indicated in bold print. Legislative history by Peter Niemczak [~CEDOCUMENT EST AUSSI I PUBL]E ENFRAN~AIS ~j

3 This document was prepared by the staff of the Parliamentary Information and Research Service to provide Canadian Parliamentarians with plain language background and analysis of proposed government legislation. Legislative summaries are not government documents. They have no official legal status and do not constitute legal advice or opinion. Please note, the Legislative Summary describes the bill as of the date shown at the beginning of the document. For the latest published version of the bill, please consult the parliamentary internet site at

4 CANADA BILL C-6: AN ACT TO AMEND THE YUKON QUARTZ MINING ACT AND THE YUKON PLACER MINING ACT* BACKGROUND On 4 March 1996, Bill C-6, an Act to amend the Yukon Quartz Mining Act and the Yukon Placer Mining Act, was introduced in the House of Commons by the Minister of Indian Affairs and Northern Development. The bill provides the framework for an environmental management regime for land-based mining activities in the Yukon. The current Yukon Quartz Mining Act and the Yukon Placer Mining Act, which were enacted in 1924 and 1906 respectively, provide for the administration and disposition of federal Crown mineral rights and the collection of royalties but contain no environmental protection measures. According to departmental sources, no legislation currently requires the mitigation of environmental effects of mining activities on mineral claims in the Yukon until such time as the mining operater must obtain a water licence under the Yukon Waters Act in order to continue operating. The issuance of a water licence triggers the review and assessment process under the Canadian Environmental Assessment Act. This could, however, be many years after intensive exploration has taken place. Bill C-6 would not affect the underlying rights to acquire and hold mineral rights in the Yukon. It would establish a system of approvals for the various levels of activities, from those giving rise to very minor environmental disturbance to those with significant environmental impact. The bill follows the recommendations of the Yukon Mining Advisory Committee (YMAC) and was drafted in full consultation with that Committee. In 1990, in response to Yukon representations to develop a made-in-yukon solution to environmental/ * The bill was originally introduced in the first session ofthe 35th Parliament as Bill C-120.

5 2 mining problems, the Minister of Indian Affairs and Northern Development formed the Committee to make recommendations to his department on the most suitable way to impose environmental conditions on mining activities in the Yukon The Committee comprises the major stakehólders in the Yukon and is chaired by a private businessman. Representation on the Committee includes the Yukon Chamber of Mines, the Kiondike Placer Miners Association, the Council of Yukon First Nations (CYFN), the Yukon Conservation Society, the Yukon Territorial Government and the Department of India~n Affairs and Northern Development (DIAND). The Committee recommended to the Minister in its April 1992 report that these t~vomining Acts should be amended to provide authority to establish specific land use and mine site reclamation regulations for the mining industry The bill and its draft land use regulations represent compromises reached in intensive negotiations by the diverse interests at the YMAC table. In addition to the consultations on-going since 1990, the Committee also conducted extensive public consultations in the Yukon during July DESCRIPTION AND ANALYSIS A. General For discussion purposes, the Yukon Quartz Mining Act will be referred to as the YQMA and the Yukon Placer Mining Act will be referred to as the YPMA. The bill would amend these Acts so that the current Act would become Part I of the new Act anda Part II would be added to deal with the environmental management regime. Certain definitions would be removed from the definition sections of each of the current Acts (section 2 (1) in each) and included in a proposed section 1. 1 so that they would apply to the whole Act, including the proposed Part II. The current YQMA (with the exceptions of section 1 and proposed section 1 1 and a few modifications mostly necessitated, by the addition and operation of Part II) would become Part I, entitled Disposition of Mineral Rights; the proposed Part II would be entitled Land Use and Reclamation. Likewise (with the exceptions of section 1 and proposed section 1 1 and some minor modifications), the current., YPMA would become Part I, entitled Disposition of Crown Placer Mining Rights; the proposed Part II would be entitled Land Use and Reclamation.

6 3 With few exceptions, the proposed Parts II of the Acts are very similar and the procedures thereunder will be discussed together. Clauses 8 (proposed sections of the YQMA) and 18 (proposed sections of the YPMA) respectively provide for the proposed Part II of each Act. References to section numbers under each Act are to the proposed section; for example, YQMA, s. 139 refers to proposed section 139 of the Yukon Quartz Mining Act. Part II of each Act would apply in respect of lands or categories of lands in the Yukon, but only to the extent that the regulations under Part II so provided (YQMA, s 133(2); YPMA, s. 99(2)). Any approval given under Part II of either Act would not preclude compliance with other legislation (YQMA, s 133(4), YPMA, s 99(4)) B. Purpose of Part II The purpose of Part II of each Act would be to ensure the development and viability of a sustainable, competitive and healthy mining industry (quartz in one Act and placer in the other) operating in a manner that would uphold the essential socio-economic and environmental values ofthe Yukon (YQMA, s. 134; YPMA, s. 100). C. Classes of Mining Activity The YQMA would provide for four levels of mineral exploration (Classes I, II, III, and IV) but, in addition, would establish a separate licensing provision to apply when a project reached the development or production stage For placer mining under the YPMA, no distinction would be drawn between the exploration and the development or production phases; hence, only four levels of mining activity are set out in the bill Class IV would, in effect, be the production stage and would require a water licence under the Yukon Waters Act The regulations under each Act would describe in detail the operation of the management regime and the responsibilities of both the mining industry and government administrators. The extent of regulation of land use operations would be based on the level of activity and the resulting environmental impact of individual projects The effects of the four classes of activity would thus range from minor environmental disturbance to significant environmental

7 4 impact. For both Acts, the first level of activity (Class I) would require no approval before being undertaken but would have to conform to the operating conditions prescribed in the regulations. This level of activity, if conducted in an acceptable manner, would create minimum environmental disturbance. The second level (Class II), although having more impact than Class I, would not be expected to have significant environmental effects. Operators would, however, be required to inform the government of the proposed operation and the measures to be undertaken to mitigate adverse. effects. Activities in Class III would have the potential to cause significant environmental impacts and would therefore, before work began, require the submission and approval of an operating plan containing details of how the operator intended to mitigate these impacts. Class IV activities would be subject to a similar process but with the added requirement of public notification and, in some cases, public consultation, before the plan was approved by the government. (YQMA, s. 136; YPMA, ) For each Act, the levels of activity would be set out in detail in the land use regulations, a draft of which, representing compromises reached at the Yukon Mining Advisory Committee table, has already been prepared. The levels relate to specific features normally present during mineral exploration, such as the number of persons in a campsite, the number of cubic metres of trenching, the number of square metres of stripping, the number of kilometres of road construction, vehicle weights and the number of kilometres travelled, the number of litres of fuel storage, etc. Under each Act, the Chief (in the case of the YQMA, the Chief of Mining Land Use designated under the Act and in the case of the YPMA, the Chief of Placer Land Use designated under the Act) would be given the authority in certain circumstances to request additional information with respect to a Class II mining activity or to bump up such mining activity to a Class III or IV, thereby subjecting it to more stringent conditions (YQMA, s 137; YPMA, s. 103.) Each Act would provide for the issuance of a Certificate of Completion for a Class. II mining activity to confirm that the operator had complied with all the provisions of the Class II notification and of Part II of the Act and its regulations. In addition, each Act would provide for the issuance of a Certificate of Completion for Class III and IV mining

8 5 activities to confirm that the operator had complied with a plan, and with Part II of the Act and its regulations. The Certificate of Completion would establish that the mining activity had, been completed satisfactorily, unless contrary evidence was produced. YPMA, s. 104.) (YQMA, s. 138; As noted previously, under the YQMA, a licence would be required if operations passed the exploration stage and entered into development or production. The licence would be issued in accordance with Part II of the Act and the regulations. If certain specified regulations were applicable, the Minister would not be permitted to issue a licence until the applicant had notified the public, in the manner directed by the Minister, of the activities that the licence would authorize. The Minister could also require that a public consultation be held. With respect to public notification and consultation, the Minister would be required to act in accordance with relevant regulations. Subject to Part II of the Act and its regulations, the Minister could include in a licence any conditions relating to Part II that he or she considered appropriate, including conditions requiring reclamation of a site during and, after development and production. (YQMA, s. 139.) While an approved operating plan was in effect, a person engaged in a Class III or IV exploration program could, despite having decided to engage in development, continue to engage in the activities authorized by the plan until a licence for development was issued. (YQMA, s. 140.) When satisfied that a development or production activity had been terminated and that the licensee had complied with all the provisions of the licence and of Part II of the Act and its regulations, the Minister would, on written application by the licensee, be required to issue a Certificate of Closure to that effect, in prescribed form. A Certificate of Closure would, unless there was evidence to the contrary, be proof of the compliance. 141.) (YQMA, s. Regulations respecting development and production activities pursuant to the proposed YQMA are in the very early drafting stage and have not yet been released for public comment.

9 6 D. Applications Under both Acts, applications for the approval of operating plans (and, in the case of the YQMA, licences), assignments of approved operating plans, Certificates of Completion, etc. would have to be in accordance with the regulations and accompanied by the appropriate fee (YQMA, s 142, YPMA, s 105) E Security Where there was a risk of significant adverse environmental effects under either Act, security could be required before a mining activity was begun. Security requirements would be spelled out in the regulations In determining whether there was such a risk, the past performance of an operator could be considered. Security could be used by the Minister to rectify environmental damage, on condition that the damage had been caused by the operator The security on deposit with respect to a particular project could be used only in relation to an incident concerning that project refunded if Security not required to reimburse the Crown would have to a mining activity was terminated, if a Certificate of Completion or Closure was issued or if the operating plan or licence was transferred to another party. (YQMA, s. 143; YPMA, 106.) 5. F. Amendments, Renewals and Assignments of Operating Plans and Licences An inspector designated under each Act would be empowered to authorize minor changes to a Class II activity (YQMA, s. 144; YPMA, s. 107). The Chief designated under each Act could approve an amendment to, or renewal of, an operating plan. Under the YQMA, the Minister could approve an amendment to a licence or renew a licence An amendment to, or renewal of, an operating plan or licence would be subject to the same process as original applications (YQMA, s. 145; YPMA, s. 108). Each Act would permit an inspector to authorize minor changes to a Class III or IV mining activity where the inspector was satisfied that these posed no risk of significant adverse environmental effect (YQMA, s. 146; YPMA, s. 109).

10 7 Under both Acts, on written application by the holder of an approved operating plan, the Chief would be required to authorize the assignment of that plan, provided the assignee undertook in writing to comply with it, furnishing appropriate security and satisfying the Chief that the assignment was not likely to contravene any condition of the plan or any provision of Part II of the Act or its regulations. Likewise, under the YQMA, the Minister would be required to authorize the assignment of a licence for development or production, provided similar conditions were met. Operating plans or licences could be assigned only in accordance with the above conditions. (YQMA, s. 147; YPMA, s. 110.) G. Inspection and Enforcement The Minister would designate inspectors, the Chief of Mining Land Use under the YQMA, and the Chief of Placer Land Use under the YPMA,. On entering a place, inspectors would be required to produce a certificate of designation to the person in charge, if so requested. (YQMA, s. 148; YPMA, s. 111.) The Acts would provide authority for the inspectors to enter any place connected with a mining operation, conduct inspections, examine records, make copies of documents and conduct tests (An inspector could not, however, enter a residence without the consent of the occupant..) Before entering a place, the inspector would be required to make reasonable efforts to ascertain whether anyone responsible for that place was present and, if so, to announce his or her arrival to that person. Persons in charge of or inside a place would be required to give the inspector all reasonable assistance to carry out his or her duties. (YQMA, ; YPMA, s. 112.) An inspector who believed on reasonable grounds that an operator had contravened, or was about to contravene, Part II of either Act, or had or was engaged in an activity likely to result in unnecessary danger to persons, property or the environment, could direct the operator in writing to take specified reasonable measures, including the cessation of an activity. Where the inspector was unable to communicate a direction to the operator after making reasonable efforts to do so, he or she could post the direction in a conspicuous place on the operator s premises. Both Acts would allow for the possibility of a review of the inspector s direction by the Chief, who would subsequently confirm, alter or revoke it.

11 8 Where requested by the affected person, within a specified time period, to review the Chief s decision, the Minister would be required to confirm it, alter it, or replace it with a new decision. An inspector would be required to revoke a direction to cease an activity on being satisfied that the need for the direction no longer existed. If the person to whom a direction was given did not comply, an inspector could, with the consent of the Chief, implement the measures set out in it. Reasonable costs incurred by the Crown in performing mitigative work, and for whatever reason not recoverable from the security deposited, could be, recovered from the person to whom the direction had been given, as a debt due to the Crown. (YQMA, ; YPMA, s. 113.) An inspector who believed, on reasonable grounds, that a mining activity had terminated and had either contravened a condition of an operating plan or licence or of Part II of the Act or the regulations, or represented a danger to persons, property or the environment, could, after making reasonable efforts to contact the operator, take reasonable measures to mitigate the adverse situation. Costs incurred by the Crown in performing mitigative work, and that for whatever reason were not recoverable from the security deposited, could be recovered from the person to whom the direction was given, as a debt due to the Crown (YQMA, ; YPMA, s. 114.) No person would be permitted wilfully to obstruct or otherwise interfere with an inspector or Chief carrying out functions under Part II of either Act Nor would a person be permitted knowingly to make a false or misleading statement to an inspector or Chief carrying out functions under Part II. (YQMA, s. 152; YPMA, s. 115.) H. Regulations The Governor in Council would be empowered with broad regulation-making powers for purposes of carrying out Part II ofeach Act; for example: prescribing lands in the Yukon in respect of which Part II would apply; prescribing the criteria for determining the classes of mining activities; prescribing conditions of operating plans; requirements for public consultation; etc. (YQMA, s. 153; YPMA, s. 116.) prescribing

12 9 I. Offences and Punishment Any person who contravened a Class I or II requirement under the YQMA or a Class I, II or III requirement under the YPMA would be guilty of a summary conviction offence and liable to a fine not exceeding $5,000. Any person who contravened a Class III or IV requirement under the YQMA or a Class IV requirement under the YPMA would be guilty of a summary conviction offence and liable to a fine not exceeding $20,000. A person who contravened a condition of a licence requirement under the YQMA would be guilty of a summary conviction offence and liable to a fine not exceeding $100,000. A person who contravened an inspector s direction under either Act would be guilty of a summary conviction offence and liable to a fine not exceeding $5,000. Similarly, a person who refused to cooperate with an inspector or who wilfully obstructed an inspector would be guilty of a summary conviction offence and liable to a fine not exceeding $10,000. Persons who contravened certain specified regulations would be guilty of a summary conviction offence and liable to a fine not exceeding $2,000. An offence committed on, or continued for, more than one day, would be deemed to be a separate offence for each such day. (YQMA, s. 154; YPMA, s. 117.) Legal action with respect to the above offences would have to be taken within two years after the Minister became aware of the offence. (YQMA, s. 155; YPMA, s. 118.) Where a prosecution had been instituted, the Crown could still seek an injunction in respect of the activity that was the subject of the prosecution. Prosecution in respect of one of the above offences would not suspend or affect a civil remedy (YQMA, s 156; YPMA, s. 119.) J. Coming into Force The bill or any provision of the bill would come into force on a day or days to be fixed by order of the Governor in Council.

13 10 COMMENTARY As noted above, the bill follows the recommendations of the Yukon Mining Advisory Committee (YMAC) and was drafted in full consultation with that Committee. General consensus among Committee members was reached on all issues but fines and security: the YUkon Conservation Society were in favour of higher amounts of fines and security than those now proposed in the bill and draft regulations, while the Yukon Chamber of Mines and the Yukon Placer Miners Association were in favour of lower amounts. Consultations on the bill and on the draft land use regulations under the bill are currently continuing between departmental officials and interested parties in the Yukon, particularly the Yukon First Nations and a number ofnative agencies. Some environmental groups, such as the Canadian Parks and Wildlife Society, the Yukon Outfitters Association, the Yukon Trappers Association and,the Wilderness Tourism Association of the Yukon, have expressed concern that the draft land use regulations, ~whichdescribe in detail the levels of mining activities referred to in the bill, are not stringent enough.