Commentary: OMA weighs in Ontario’s Bill 173

The following is an edited portion of the Ontario Mining Association’s submission to the Standing Committee on General Government on the Mining Act (Bill 173) and the Far North Act (Bill 191).

The OMA views Bill 173 and Bill 191 as opportunities for government (federal, provincial and local), First Nations, investors, the mining industry and all Ontarians to move forward in a positive manner to advance the importance of mining in society, to share in the wealth and growth opportunities generated by our industry and to realize the jobs, training and entrepreneurial opportunities it provides to all people in the province.

In addressing the views of our members on the two proposed pieces of legislation, we will be commenting only on what we believe is the overall thrust of the legislative proposals, as currently drafted.

There is considerable redrafting required to ensure that not only the people of the North, especially the First Nations communities, can better share in the benefits of mining, but that the mining industry as a whole will continue to flourish in an environment of trust, respect and strong partnerships.

The economic and social impacts of a mine are in many ways like the geological nature of a mine itself: That is, the bulk of the activity is hidden below the ground and not readily visible at first glance.

In its Mining Act revision, the Ontario government laid the foundation for the continued success of the mining sector in the province by recognizing the need to preserve a mineral tenure regime that offers a level of confidentiality, security and certainty that will allow large and small companies to compete on a level playing field.

While retaining competitive staking, the government nonetheless addressed the concerns of private landowners by removing the need to physically access land prior to claim acquisition through the introduction of an electronic map staking system.

The OMA supports this approach, as it makes it possible to avoid unnecessary disturbance to the land, inconvenience to the surface rights holder and/or potential infringement on aboriginal or treaty rights.

Other advantages to map staking include greater efficiency, avoidance of unnecessary costs and the ability to channel resources to more value added activities, avoidance of safety risks, as well as a reduction in the use of fossil fuels and thus, lower emissions of greenhouse gases.

The OMA commends the government for offering a workable and progressive solution that meets the needs of a variety of stakeholders and supports the provision of $40 million to assist with the implementation of the proposed changes to the Mining Act.

At the same time, there are five areas we would like to seek clarification, since the legislation as currently drafted is ambiguous and has the potential to incur conflict, court challenges and unintended harm to the mining industry and First Nations relationships if not amended.

Aboriginal Relations and the Duty to Consult — It is our view that the proposed wording in the bill around the duty to consult is inconsistent with what the courts have clearly decreed. The Supreme Court of Canada has made it clear that the duty to consult lies solely, with a few exceptions, with the Crown. However, proposed subsections 78.1(1), 78.2(2), 139.2(4.1), 140(1) and 141(1) as proposed, strongly suggest that these duties are to fall primarily, if not exclusively, to the proponent (mining industry).

A basic foundation of mining success in Ontario — the thing that sets us apart and gives us an advantage over some other jurisdictions with significant mineral potential — is rule of law and certainty of title.

“Duty to consult,” as presented in the bill, seems to demand consultation by a proponent far beyond the requirements of case law. This ambiguity may be reflective of the current general practice in the province, which sees proponents, including our members, engage almost exclusively in consultation, both in the interest of relationship-building and also in furthering results to meet business timelines and objectives.

There is no doubt that relationship-building from the outset is essential and has, indeed, become common practice among OMA members. However, when it comes to ensuring transparency and the supremacy of the rule of law, the duty to consult is placed unequivocally with the Crown.

This means that the act should make explicit reference to government-appointed mineral development officers bearing full responsibility not just for the approval, but for the actual conduct of consultation, thus fulfilling the government’s duty to consult.

Given these clear provisions, and recognizing that they would constitute appropriate consideration of community interests, the industry would be prepared to accept the added regulatory burden of exploration plans and permits, the reintroduction of which runs counter to the government’s overriding Open for Business policy.

Needless to say, we expect that the government will work within the spirit of the Open for Business policy by putting in place administrative measures that will ensure fixed timelines and an efficient process associated with all new regulatory measures.

Purpose Clause — At first glance, the purpose of the act appears to promote the mineral industry. However, upon closer review, we have some concerns with the current wording in Bill 173. Our concern comes from our reading of section 78.2(2), which states that the purpose of the act is one of the four principal criteria that the director of exploration would be obliged to apply in deciding whether or not to issue an exploration permit.

As a result, section 2 could be expected to play a key role in this regard. It is to be expected that the director would want to assume a gatekeeper role in the overall regulatory process and thereby exert influence over future exploration activities. It therefore strikes us that section 2 must be drafted with greater clarity.

Given our reading of sections 2 and 78.2(2), and guidance received from the courts as it relates to the duty to consult, and if appropriate, accommodate aboriginal people, the OMA recommends the following change to the purpose clause:

The purpose of this act is to encourage prospecting, staking and exploration for the development of mineral resources in a manner that minimizes: (a) any adverse impact of these activities on public health, safety or the environment; and (b) any potential infringement of existing aboriginal and treaty rights of aboriginal peoples of Canada that are recognized and affirmed pursuant to section 35 of the Constitution Act, 1982, or the exercise of those aboriginal and treaty rights.

The omission of “including the duty to consult” is not to diminish the importance of consultation, but to ensure the act is consistent with the decision of the courts. Again, the courts have established that the duty to consult falls solely on the government as one of several obligations it has when contemplating a decision or action that has the potential to infringe on aboriginal or treaty rights, or the exercise of those rights.

As such, it appears to us that it is redundant to mention the duty to consult in the purpose clause, since as it is currently written, it could be interpreted to read that the duty to consult is one of the aboriginal and treaty rights, recognized and affirmed by section 35 of the Constitution Act in 1982, which it is not.

Dispute Resolution – Aboriginal Rights — In terms of promoting fair and balanced development, the government has taken the right approach in proposing improvements to the dispute resolution process by introducing the notion of a tribunal.

We stress that a truly robust process needs to be unambiguous, fair and transparent. Therefore, in addition to being experienced mediators, tribunal members must understand the issues and the law. In defining tribunal nomination criteria, the government should consider the need to engage individuals with local expertise, including aboriginal representatives.

As with the consultation process, clear timelines must be associated with the dispute resolution process to ensure security of investment and business continuity, taking into account factors such as timing of flow-through share funding and the seasonal nature of work in the North (with access to some sites being restricted by the availability of winter roads).

Rights to Appeal-Penalties — The draft legislation contains a number of provisions which state that certain decisions made under the act cannot be appealed while others can be.

Section 51 provides that the minister can issue an order restricting a claim holder’s rights to use his land and concludes that whatever the decision, it’s not appealable. However, we see a conflict with this in section 105 of the bill which allows an appeal to the courts in matters related to consultation with aboriginal communities relative to their land, treaty rights, etc.

The OMA respects the interest of First Nations in preserving lands that are significant to their culture. However, it is our understanding that these cultural sites do not have a separate and independent basis in law and therefore fall within the umbrella of “aboriginal rights.”

As such, decisions of the minister, or disputes that involve sites of aboriginal cultural significance should be subject to the same right of appeal as all other decisions involving aboriginal or treaty rights. It is therefore important that such disputes be subject to the rule of the courts.

We recommend that section 51(6) denying the right of appeal be rescinded.

Protecting the Opening of New Mines — The OMA respectfully submits that sections 204 and 205 of Bill 173 fail to provide the balance and certainty required in the event of a decision to prohibit new mining operations in the Far North until a community based land-use plan is in place.

As drafted, this section denies the legitimate expectations of mining companies to enjoy the results of their investment, which they likely have already made to acquire property in this vast region, by not permitting them to bring a mine into production.

We only need to consider the financial and community embarrassment that would have occurred to De Beers Canada at its Victor mine operation had this language been in effect and the loss that would have resulted to the local communities in terms of infrastructure, jobs, economic development and hope for a better life.

We are cognizant that section 205 states that, if enacted, the existing mineral tenure held in the Far North, as well as related approvals, would remain valid even if a land-use plan was inconsistent with mining. However, section 204 makes it unclear that the protection assumed by section 205 would likely be of value.

Section 204 appears to clearly state that any protected land under section 205 cannot be taken to production if the community based land-use plan is inconsistent with the opening of a mine. Also, section 204 ensures that until the land-use plan comes into existence, the question of whether a new mine can be opened does not arise.

Therefore, more clarity is required as to what occurs in the interim between no land-use plan and the development of such a plan.

We believe the government should consider incorporating a mechanism, whereby existing projects that demonstrate significant economic potential, and have the support of local communities, be grandfathered on a case-by-case basis, which would allow them to proceed to production while the community completes and ratifies its land-use plan.

We suggest that without significant resources from the government both in terms of money and expertise to support capacity building for the communities to develop land-use plans, it is unrealistic for the government to expect any mining development to proceed in the Far North for a decade or more.

Tomorrow, part II: the OMA’s response to Bill 191.