How are Canada Port Authorities governed?
Please note that the following information is general in nature and should not be relied upon or construed as legal advice.
The following outlines how port authorities are governed, including the various checks and balances in place to ensure port authorities always operate in the public interest.
The federal Canada Marine Act and other legislation and regulations, listed below, set out how Canada Port Authorities are governed. Canada Port Authorities are agents of the Crown and act as arm’s length agents of the government. The Canada Marine Act describes a Canada Port Authority as a port that:
- Is, and is likely to remain, financially self-sufficient
- Is of strategic significance to Canada’s trade
- Is linked to a major rail line or a major highway infrastructure
- Has diversified traffic
Canada Port Authorities are created by the federal minister of transport by issuing letters patent that incorporate the authority. Port authorities are structured like an incorporated business, much like a public company. However, there are no shares and the port authority is effectively “owned” by the federal government through Transport Canada. This allows port authorities to operate in a commercially nimble way, which helps ensure Canada’s trade needs are well met, ultimately supporting our national economy.
Port authorities are financially self-sufficient, earning revenues from port users who lease the port’s federal lands and pay various fees such as harbour dues. In addition to covering operating expenses, port authorities are required to invest excess revenues in port infrastructure. In the case of the Port of Vancouver, about $80 million has been reinvested in infrastructure each year. Canada Port Authorities are also required to pay an annual gross revenue charge that is laid out in their letters patent.
Among other things, a port authority’s letters patent set out the code of conduct governing the directors and officers of the port authority, as well as specify the extent of the activities the port authority may undertake, the limits of a port authority’s ability to contract as agent for His Majesty, and the limits of the port authority to borrow money.
Any changes to the letters patent require supplementary letters patent. The minister of transport issues supplemental letters patent if the changes are relating to activities that are core to the port authority’s usual port activities. If the changes are not core to port operations, the supplementary letters patent must be approved by the president of the Treasury Board and the minister of finance. If the changes are to a port authority’s borrowing limit, they must be approved by the Governor in Council, on the recommendation of the ministers of transport and finance.
Board of directors
Each of Canada’s 18 federal port authorities is governed by a board of directors. Board members are appointed as follows:
- One individual nominated by the federal minister of transport and appointed by the Governor in Council
- One individual appointed by the municipalities mentioned in the letters patent (16 in the case of the Port of Vancouver)
- One individual appointed by the province in which the port is situated (In the case of the Port of Vancouver, another individual is appointed by the provinces of Alberta, Saskatchewan and Manitoba acting together)
- The remaining individuals nominated by the federal minister of transport in consultation with the users selected by the minister or the classes of users mentioned in the letters patent (Schedule “D”)
The board of the directors of the Vancouver Fraser Port Authority and its committees have six regular meetings each year and oversee the annual general meeting in the spring. Additional meetings are held as required.
Learn more about the Vancouver Fraser Port Authority Board of Directors.
Project reviews and permitting
Canada Port Authorities have been required to be the permitting authority for federal port lands and waters since the introduction of the Canada Marine Act in 1998, and they conduct environmental reviews of projects in accordance with Section 82 of the Impact Assessment Act.
As arm’s-length bodies to the federal government and unelected regulators, port authorities are tasked with addressing the technical merits of a project, as opposed to making public policy decisions. For example, port authorities cannot set Canada’s trade policy, determine what commodities or goods can be legally exchanged, or make value judgements that impact Canada’s climate change policies.
Instead, our role is to accept project applications, including required studies, and then review and assess the technical merits of the application prior to making an evidenced-based project permit decision.
Larger, more complex projects typically require permits from other regulatory agencies, such as Fisheries and Oceans Canada. In addition to meeting the requirements of those agencies, these other permitting processes provide additional oversight of port authority work.
The largest projects (such as the port authority’s proposed Roberts Bank Terminal 2) are federally reviewed and undergo the highest level of independent scrutiny.
Occasionally, like many other federal, provincial, and municipal agencies, port authorities are required to act as both permitting agency and project proponent. To ensure the permit review process is entirely objective, the Vancouver Fraser Port Authority ensures clear separation of the regulatory and proponent functions of the organization. Our reviews are conducted by environmental scientists and specialists.
To provide for public oversight across all major project reviews, all work and studies related to a review are made publicly available. Larger projects also require public consultation. The port authority’s project and environmental review process (which has been evaluated and endorsed by third-party experts) follows current best practices and is continuously being improved.
Learn more about the Vancouver Fraser Port Authority’s Project and Environmental Review process.
Other oversight mechanisms
In addition to the governance structure set out by the Canada Marine Act and other acts, there are several mechanisms in place that provide oversight to port authority matters:
- Canada Port Authorities must annually submit to the minister of transport a five-year business plan containing such information as the minister may require, including any material changes from previous business plans.
- Port authorities are required to file an annual, audited financial report. Additionally, the Vancouver Fraser Port Authority has elected to disclose a management discussion and analysis report and file a bi-annual sustainability report. These reports are available to the public on our website.
- Canada Port Authorities are subject to a special examination every five years that assesses whether the port authority’s systems and practices provide reasonable assurance that its assets are safeguarded and controlled; its financial, human and physical resources are managed economically and efficiently; and its operations are carried out effectively.
- With respect to project and environmental reviews as per the Impact Assessment Act:
- Port authorities are required to post information about projects on the Canadian Impact Assessment Registry website and provide the public 30 days to provide their comments to us, which we consider in making our determination. After we complete our review we post the outcome of our determination on the website, and if approved, list the mitigation measures taken into account that are required to avoid significant adverse environmental effects.
- The federal government has the ability to decide to review a project that would otherwise have been reviewed by the port authority.
- The federal government can review decisions made by the port authority.
- Any regulatory decision of the port authority can be challenged by way of a judicial review.
- In addition to restrictions on land use outlined in the letters patent, any land a port authority seeks to purchase requires supplementary letters patent from Transport Canada. The Vancouver Fraser Port Authority has committed to work with local governments and agencies to ensure land negotiations appropriately consider and work within existing frameworks, such as the B.C. Agricultural Land Commission.
In addition to the above, the Vancouver Fraser Port Authority works very closely with all levels of government to ensure awareness and understanding of port activities and collaborate on projects that will address growing trade and mitigate the impact of that trade on local communities and the environment. These include:
- Four community liaison committees that meet several times a year
- Annual meeting between the board of directors and all Lower Mainland mayors
- Membership on several regional planning committees
- Leadership and/or participation on collaborative teams tasked with identifying regional infrastructure improvements
- Participation in municipal conferences at the local, provincial and national levels
Federal acts, regulations and rules affecting Canada Port Authorities
Access to Information Act (R.S.C., 1985, c. A-1)
Canada Customs Act [R.S.C., 1985, c.1 (2nd Supp.)] Canada Marine Act (S. C. 1998, c.10)
Canada Shipping Act, 2001 (2001, c.26)
Canada Transportation Act (S.C. 1996, c.10)
Canadian Transportation Accident Investigation and Safety Board Act (S.C. 1989 c.3)
Coasting Trade Act (S.C. 1992, c. 31)
Federal-Provincial Fiscal Arrangements Act (R.S.C., 1985, c. F-8)
Impact Assessment Act (S.C. 2019, c. 28, s. 1)
Marine Transportation Security Act (S.C. 1994, c. 40)
Navigable Waters Protection Act (R.S.C., 1985, c. N-22) – being amended as Navigation Protection Act, currently in drafting stage.
Payments in Lieu of Taxes Act (R.S.C., 1985, c. M-13)
Pilotage Act (R.S.C., 1985, c. P-14)
Privacy Act (R.S.C., 1985, c. P-21)
Transportation of Dangerous Goods Act 1992 (c. 34)
Cargo, Fumigation and Tackle Regulations (SOR/2007-128)
Collision Regulations (C.R.C., c. 1416)
Marine Transportation Security Regulations (MTSR)
Plant Protection Policy for Asian Gypsy Moth
Port Authorities Management Regulations (SOR/99-101)
Port Authorities Operations Regulations (SOR/2000-55)
Transportation Safety Board Regulations – Repealed 2014-02-28 *see Canadian Transportation Accident Investigation and Safety Board Act (S.C. 1989 c.3)
International Rules and Supporting Codes of the International Maritime Organization (IMO)
International Code for the Construction and Equipment of Ships carrying Dangerous Chemicals in Bulk (IBC)
International Convention for the Safety of Life at Sea (SOLAS), 1974
International Maritime Dangerous Goods (IMDG) Code