The Canadian government has tabled legislation designed to move major infrastructure projects through the federal approval process more quickly while making significant changes to collective bargaining and the government’s powers during major labour disputes.
Bill C-39, the Building Canada Strong Act, introduced Monday by Prime Minister Mark Carney’s government, would establish shorter review timelines, create “Regions of National Interest” where certain projects could receive pre-approval, and shift responsibility for reviewing some major energy and infrastructure projects to federal regulators with sector-specific expertise.
Transport Minister Steven MacKinnon said the legislation is intended to give Canada more capacity to build infrastructure efficiently at a time of international economic uncertainty. The government argues that while Canada cannot control decisions taken by other countries, it can strengthen its own infrastructure, supply chains and investment environment.
National interest zones and faster project approvals
One of the most significant elements of the bill is the proposed creation of Regions of National Interest.
Senior government officials said those regions would effectively give designated projects treatment similar to projects already carrying a national-interest designation. Before a region could be established, consultations would have to take place. Once designated, however, certain projects could benefit from special exemptions involving as many as a dozen different federal laws.
The proposal follows two discussion papers released by Ottawa in May that examined the possibility of creating so-called “economic zones.” Those zones would have allowed the federal cabinet to determine which activities could take place within them and would have given ministers the ability to pre-approve certain projects.
The May papers highlighted potential applications including transportation corridors, telecommunications networks, energy production and transmission. The bill, however, is written broadly enough to allow the government to apply the mechanism to a much wider range of projects.
Under the proposed framework, a regional assessment would first determine the geographic boundaries of a region, the types of activities that could be carried out and the standard conditions or mitigation measures that would apply. Those assessments would also consider cumulative effects and involve consultations with Indigenous Peoples.
Following that assessment, a recommendation would be made to the Governor in Council. Projects covered by the regional assessment could then be considered pre-approved, provided they complied with the applicable conditions and mitigation measures. Projects not covered by the initial assessment but capable of creating environmental or other impacts could still require additional assessment and consultation.
Regulators would take over some major reviews
Bill C-39 would also change which federal bodies are responsible for assessing major projects.
The legislation would remove the review of a number of major developments, including pipelines and power transmission lines, from the Impact Assessment Agency of Canada.
The Canada Energy Regulator would instead oversee reviews of international and interprovincial pipelines, transmission lines and certain offshore renewable energy projects. The Canadian Nuclear Safety Commission would take responsibility for nuclear and uranium projects.
The federal government says the change reflects feedback received during consultations from industry, which argued that the specialized energy expertise available at the Canada Energy Regulator was not matched at the Impact Assessment Agency for certain projects.
Dominic LeBlanc, the minister responsible for breaking down barriers to internal trade and advancing nation-building projects, said the changes would not reduce environmental assessments or the government’s obligations to Indigenous rights holders.
Ottawa maintains that the objective is instead to carry out the same assessment work through a more coordinated and efficient process, arguing that the current economic environment requires greater speed and certainty.
The legislation would establish a one-year federal review timeline once proponents have submitted complete applications and the required information. For small and medium-sized projects reviewed under the Energy Regulator and Nuclear Safety Commission frameworks, the target timeline would be reduced from one year to six months.
The government has also proposed allowing certain preparatory construction work to begin before all federal permits have been issued for projects carrying a national-interest designation or located within a Region of National Interest.
LeBlanc stressed that the provision would be tightly restricted and reserved for exceptional circumstances. Preparatory activities could include site preparation or limited research needed to organize future construction. It would not amount to authorization to begin the full project, and work that contravened the project’s conditions could be stopped or removed.
Ottawa delayed the bill after environmental and Indigenous opposition
The Liberals had originally planned to introduce the legislation in the spring, but postponed it following criticism from environmental and Indigenous organizations.
The government subsequently conducted extensive consultations over the summer and said it received more than 21,000 emails concerning the proposed reforms.
Earlier this month, Ottawa also abandoned a proposal that would have exempted certain projects from laws protecting species at risk after the idea generated an overwhelmingly negative response during consultations.
However, the Building Canada Act, which was passed as part of the controversial Bill C-5 last summer, still gives the federal government the ability to allow projects carrying a “national interest” designation to operate outside the requirements of a dozen laws, including the Species At Risk Act.
Environmental organizations renewed their criticism after Bill C-39 was tabled Monday.
Julia Levin, associate director of national climate at Environmental Defence, argued that reducing federal responsibility for project reviews could leave communities, wildlife and natural areas with less information about potential risks. She also said the proposed approach could make meaningful consultation with Indigenous communities more difficult despite constitutional obligations.
During lobbying efforts on Parliament Hill in June, Carney said the government was not abandoning environmental protections. Ottawa continues to maintain that the legislation preserves environmental standards and Indigenous rights while streamlining the approval process.
New rules would intervene earlier in collective bargaining
The bill goes beyond infrastructure approvals, with a substantial package of proposed changes to Canada’s federal labour regime.
Under the proposed legislation, collective bargaining would have to begin six months before a collective agreement expires in certain higher-risk situations. The requirement would apply where the existing agreement is more than five years old, or where the previous bargaining round ended in a work stoppage.
The government also wants to increase the use of federal mediation and require employers and unions involved in a work stoppage to participate in federally mediated “relationship repair” efforts.
Bill C-39 would further increase enforcement tools and penalties for bad-faith bargaining. Ottawa says the broader objective is to give parties more opportunities to reach an agreement before disputes escalate into strikes or lockouts.
The government says roughly 95 per cent of labour disputes in federally regulated sectors are already resolved without a work stoppage through the Federal Mediation and Conciliation Service, but argues that additional tools are needed for disputes with wider economic consequences.
“National interest” would become a factor in ending major strikes
Bill C-39 would retain limits, or “guardrails,” around the federal labour minister’s ability to direct the Canadian Industrial Relations Board to order workers back to work or refer a dispute to binding arbitration.
However, the legislation explicitly refers to the national interest as a potential basis for exercising that authority.
The bill identifies three factors that could be considered: whether a strike or lockout is having a significant impact on the Canadian economy, whether the work stoppage is causing serious social disruption, and whether government intervention affects freedom of association.
The proposed framework would also introduce a special mediator for a 21-day period. That mediator would prepare a report for the minister identifying the issues still dividing the two sides, outlining their respective positions and assessing the prospects for a settlement.
The report, including recommendations, would be made public five days after it is issued unless the parties reach an agreement before then. The government says the special mediation process is intended to put greater pressure on both sides to settle disputes through bargaining before extraordinary government powers are considered.
Labour movement welcomes some measures but rejects strike intervention powers
Bea Bruske, president of the Canadian Labour Congress, said the organization supports parts of the bill that would strengthen worker protections.
Among the measures welcomed by the labour movement are proposed improvements to successor rights in contract flipping and stronger protections against wage theft.
But Bruske criticized the proposed changes surrounding the right to strike, arguing that the government would gain new and broader powers to end a legal strike whenever it determines that the dispute is, or could become, contrary to the national interest.
The Canadian Labour Congress rejects the premise that workers exercising bargaining rights should be viewed as being at odds with the national interest.
The government, for its part, argues that the legislation sets a higher threshold for intervention and adds a structured process before ministers could use those powers.
Jobs Minister Patty Hajdu said the new framework means the labour minister would have to meet a “higher bar” before intervention could take place.
Bill C-39 therefore combines two major strands of the federal government’s economic agenda: speeding up the approval and construction of major infrastructure while redesigning parts of the labour system to encourage earlier settlements and provide Ottawa with additional tools for disputes considered capable of creating significant national disruption.
