TRAN Committee Meeting

    I would like to call our meeting to order. I'd first like to welcome our witness by video conference, Ms. Legars of the Shipping Federation of Canada.

    Live here in the room, we have Mr. Serge Buy from the Canadian Ferry Operators Association.

    I apologize to both of you for the delay, but votes sometimes happen around this place.

    We'll get right to it and I think, Ms. Legars, we're going to send it to you for 10 minutes or less, please.

    Thank you for inviting the Shipping Federation of Canada to testify on this matter today.

     The Federation has represented ocean shipping in Canada since 1903. We represent all segments of ocean shipping from coast to coast.

     The world fleet that serves Canada represents the vast majority of commercial ships’ calls and of the freight volumes carried on Canadian waters. We can say that ocean shipping is the carrier of Canada’s world trade.

    I will first have a very quick introduction to provide an overview of ocean shipping's regulatory framework.

    The world fleet, which serves Canada and all the other countries in the world, is operated under various flags and is governed by a wide range of international conventions, especially the International Maritime Organization and International Labour Organization's conventions. These conventions are implemented in Canada through domestic legislation, mainly the Canada Shipping Act, 2001. These conventions are enforced by both flag administrations and port state administrations. Here, I will open a parenthesis before I go further to remind you what flag administrations and port state administrations are and what they do.

    So what is a flag administration? Before allowing a ship to fly its flag, a flag administration must ensure that the ship meets all the international standards set out in the conventions ratified by its country and that the ship possesses all the relevant certifications. It's here that we have the classification societies that play a key role because these certifications are issued by classification societies, which are specialized marine engineering firms that play a key role in the shipping industry by developing technical standards or rules for the design and construction of ships, approving designs against their standards, and conducting surveys during construction to ensure that the ship is built in accordance with the approved design and rule requirements. A ship cannot be insured or brought into operation until it has been certified by a classification society recognized by the flag state.

    Then we have the port state administrations. Port state administrations carry out inspections and enforcement of foreign ships that call at their ports. In Canada, the port state administration is Transport Canada Marine Safety. They do so as part of regional international enforcement networks. Canada is part of two such networks, the Paris MOU and the Tokyo MOU. The Paris MOU is an enforcement network of 27 countries that covers the coastal states of the North Atlantic Ocean and the Tokyo MOU is an enforcement network of 18 countries that covers the coastal states of the Asia-Pacific Region.

     I have to underline at this point that the U.S. is not a member of either of these networks. But it still does port state control to enforce international conventions and shares its enforcement information with the other port state administrations and networks.

    The annual reports on enforcement of each of these regions are available on the website of each of these networks. Transport Canada also publishes its data on port state control and statistics as well as the U.S Coast Guard. In an appendix that I have sent to the clerk, I put the links to all these reports and the enforcement statistics.

    So I close the parenthesis. This was just to introduce how the regulatory framework is shaped for ocean shipping.

     Now we'll go the heart of the matter, which is the transportation of dangerous goods by sea; and in another section I will address safety management systems in transportation by sea.

    Regarding the transportation of dangerous goods by sea, we remind you once again that all ships carry bunkers as fuel. In addition, over one quarter of the total volume of cargo carried around the globe by ships comprises oil or oil products. On top of this, many other dangerous goods are carried by ships as cargo, such as fertilizers and chemical products carried in bulk, packaged dangerous goods, etc.

    The three pillars that have already been mentioned with respect to the management of transportation risks—safety, preparedness and response, and liability and compensation as a third pillar—also apply to the issue of transportation of dangerous goods by sea. However, my remarks today will address only the first pillar, which is the one of marine safety. The issue of preparedness and response for HNS products will be addressed in the soon-to-be-released report of the tanker safety expert panel. We already shared our views on the liability regime for HNS cargo when we testified before this committee with respect to Bill C-3, which is now in the Senate.

    To go back to marine safety and dangerous goods by sea, all ships, whatever they carry, have to comply with many international standards, the most important of which are contained in the SOLAS convention, which is the safety of life at sea convention, and the MARPOL convention, which is on marine pollution, both from IMO, the International Maritime Organization.

    These conventions contain provisions that are generally applicable to all ships, as well as specific provisions that are applicable to specific types of ships, including tankers. More specifically, the IMO has developed construction standards for oil tankers, for gas tankers, and for ships carrying dangerous chemicals in bulk. The IMO has also developed the international maritime dangerous goods code, known as the IMDG code, which was developed in 1960 and applies worldwide to the transportation of dangerous goods by sea. The code is mandatory and is updated every two years. We also have the STCW convention on crew training and certification. Part V of this convention addresses special training requirements for oil tankers, chemical tankers, and liquefied gas tankers.

    The IMO conventions, including the IMDG code, are implemented in Canada via the Canada Shipping Act, 2001, and related regulations. The IMDG code is also implemented via the Transportation of Dangerous Goods Act.

    The IMDG code provides essentially for the classification of dangerous goods into nine classes, subdivided into divisions. It sets out principles and detailed recommendations for individual substances and sound operational practices, including terminology, packaging, labelling, stowage, segregation, handling, and emergency response action. These conventions are enforced in Canada by Transport Canada, via port state control for the international fleet, as part of the enforcement networks I mentioned earlier.

    Statistics that are available on the website, and that I recap in the appendix that has been circulated to the clerk, show that there are very few deficiencies with respect to the carriage of dangerous goods, and that tankers have the best performance of all ship types.

    With regard to safety management systems in transportation by sea, we have an international safety management code, known as the ISM code, which requires the shipowner or any person who has assumed responsibility for the ship to establish a safety management system. This code was developed under the auspices of the IMO, and it became mandatory in 1998 for all ships over 500 tonnes engaged in international voyages. It is also enforced by both the flag states and port state control.

    The purpose of the ISM code is to provide an international standard for the safe management and operation of ships and for pollution prevention. It is based on an assessment of risks, the establishment of appropriate safeguards, documented procedures and instructions, and continuous improvement.

    The functional requirements for a safety management system must include safety. There are six main functional requirements: a safety and environmental protection policy; instructions and procedures to ensure safe operation of ships and protection of the environment in compliance with the relevant international and flag state legislation; definition of levels of authority and lines of communication between and among shore and shipboard personnel; procedures for reporting accidents and non-conformities with the code’s provisions; procedures to prepare for and respond to emergency situations; and procedures for internal audits and management reviews on board and ashore at least every year.

    A ship cannot trade internationally without an ISM certificate issued by its flag state. The certificate is issued for a period that cannot exceed five years and is subject to at least one intermediate verification by the flag administration or by an organization recognized by the flag administration. The ISM certificate will also be inspected by port state inspectors.

    The Tokyo MOU statistics show that about 1% of inspections found deficiencies with the ISM code that needed attention. The Paris MOU statistics show that about 3.7% of inspections found deficiencies with the ISM code. If there is evidence of major non-conformity with the code, the certificate should be withdrawn by the flag administration. The ISM code has been assessed as a successful tool for the enforcement of the safety culture throughout the shipping industry worldwide.

    In a nutshell, this is the framework under which the ocean shipping operates with respect to the transportation of dangerous goods by sea and safety management systems. What is of paramount importance for the international industry is the global consistency of this framework, and the consistency and transparency of the enforcement efforts related thereto.

    Thank you for your attention.

    Ms. Legars, could you wrap up.... Oh, are you finished?

    Yes, I'm finished.

    Okay, thank you very much.

    We'll now move to Mr. Buy. You have 10 minutes.

    Thanks very much, Mr. Chair.

     I promise I will try to stay within the 10 minutes for my presentation.

    I want to thank you for having invited us to speak here. I know I'll diverge a little from my presentation, but I think it's really important for the ferry sector to be represented and be able to talk to this committee about various issues.

    Good morning, ladies and gentlemen, and very soon, good afternoon. First, let me thank you for inviting the Canadian Ferry Operators Association to make a presentation to this committee.

    It is somewhat of a special occasion for us. For the past few years, if not the past decade, the ferry sector was completely absent from any discussion on the parliamentary level related to transportation. That's of concern to our sector. However, ferry operators play an essential role in Canada's transportation infrastructure. A lot of you know that from having ferries in and close to your ridings. However, let me give you some quick numbers that you may not be aware of.

    Ferry operators transported over 47 million passengers in Canada in 2013. As a comparison, the airline sector transported about 60 million. There isn't a huge difference between the two. Close to 17 million vehicles were on board ferries in the same year. About 10,000 people are employed by ferry operators across the country. Over 25,000 jobs are indirectly linked to ferry operations. There are close to 180 ferry routes in Canada, with the biggest use of ferries being in British Columbia, followed by Atlantic Canada, Quebec, Ontario, and then the Prairies and northern Canada.

    Our members transport a variety of passengers, from foot passengers to large transport trucks, from individuals getting on board on their daily commute or to catch a plane to the truck that delivers essential supplies to a remote community. We indeed serve a variety of communities, linking parts of major urban centres in Vancouver and Halifax, taking passengers to airport islands in Toronto and Prince Rupert, and reaching far and remote communities in Labrador, northern Manitoba, northern Saskatchewan, and northern British Columbia. That is the reason we must keep ferries safe. We are proud to say that, in general, the ferry sector has an impeccable record when it comes to safety.

    In 2011 and 2012, the Transportation Safety Board reported no ferry accidents involving injury or fatality. In 2012 only 14 minor incidents involved ferries. That's a major reduction from the previous years. Most important of all and relevant to this specific discussion, we have no record of any major accident involving the transportation of dangerous goods.

    For ferries, the transportation of dangerous goods regulations provide the regulatory framework to operators in the transportation of dangerous goods. Some operators also look for guidance to the international dangerous goods regulations developed by the International Maritime Organization.

    In general, the Canadian Ferry Operators Association is pleased with the existing regulations. However, there are a few areas of concern that could be addressed.

    The first is clarity. Some of the regulations are not clear to operators, and a thorough review needs to be done to ensure clarity and to allow our operators to implement them properly. The regulations are not easy to interpret, and this makes it difficult on occasion for our members to follow them.

    As an example, there is an issue of inconsistency on what defines a short-run ferry. In the federal regulations it's three kilometres, in the marine safety regulations it's five kilometres. We believe that the issue came from the fact that it used to be three miles. Some have translated three miles to three kilometres, others have changed three miles to five kilometres. This is an issue of consistency and clarity; the problem is that it means a lot to our ferry operators when that's not clear.

    The implementation of regulations is another issue. Another example that I can give you is that exemptions were made to allow unplugged containers to be transported by ferries with no more than 25 passengers on short runs in some remote communities. This was withdrawn, bitterly, by one inspector recently, and that created congestion in that community and made it difficult for people to move on and off an island. That needs to be fixed as well. A lot of it depends on the voluntary declaration by transport truck drivers. That's an issue on occasion: whether or not the records are kept properly, whether or not certain things are missing.

    While our members do their own inspections and verifications, more due diligence on inspecting transport trucks before they enter a ferry would help. You don't want to have an issue when you're between Vancouver and Victoria.

     The training of our members' staff is essential and our members regularly invest thousands and thousands of dollars to ensure the safest operations possible.

    We're proud of our record and look forward to collaborating with you in the future on the betterment of our transportation infrastructure.

    Thank you, Mr. Chair.

    Thank you very much.

    With that we'll go directly to questions.

    Mr. Mai, for seven minutes.

    Thank you to all our witnesses for being here today. Again, as the chair said, we apologize for being late because of the votes.

    I'll start with Ms. Legars of the Shipping Federation of Canada.

     Your organization submitted two documents: “Canada's Oil Spill Preparedness, Response & Prevention Regime”, which was submitted by the Shipping Federation of Canada in 2012, and another document.

    What you came up with are suggestions and recommendations to make sure that things are safer. What you did in 2012 and also in 2013 was to ask that the original environmental team oil spill response exercise be re-established to provide for effective planning and response to incidents. Are you familiar with that recommendation and can you talk more about it?

    Yes. I remember that we made this recommendation at the time. I don't remember the exact details of it because we worked as a team on that. I was not the only one to work on that document.

    However, this was before the tanker safety panel exercise that led to a report issued last fall by the tanker safety panel. Basically, we supported the various recommendations made by the tanker safety panel at the time, and that's the only thing that I'm able to recall around this specific issue.

    Do you know in practice if it was actually applied? Yes, I agree that it was part of the 40-something recommendations, but do you know if in practice that has been applied? Have you followed-up?

    It's something that I can take note of and can respond to the committee.

    Looking at it, it is really making sure that we have more information.

    It was one of the recommendations made by your organization and one we often hear about in the sector.

    This is also related to the transport of dangerous goods by rail. Regardless, we're talking about the fact that there could be more information, whether from municipalities or stakeholders. That was in one of your previous recommendations.

    Can you talk about the challenges and what can be done to improve the situation by collaborating with stakeholders at several levels and responding to accidents?

    We think the three-pillar approach mentioned earlier is the right way to go. We start with the first pillar, which is everything to do with marine safety, to prevent accidents. That is the most important pillar.

    The second pillar is secondary to the first, but it is important nonetheless. It is about knowing what to do if something happens and making sure we are ready to deal with it.

    The third pillar, liability and compensation, is the lowest priority.

    In general, the system makes sense and works. That is what we told the expert panel on oil tankers. We made a number of recommendations to improve it because all systems have to be reviewed continuously and improved anyway. It's a process, a continuous improvement philosophy. However, in our industry specifically, we have to stay in sync with all of the international conventions. Our ships are constantly sailing from one country to another.

    With respect to the issue we are discussing today, the transport of dangerous goods, which includes petroleum products, of course, even though it is much bigger than that, we think that the system is strong and healthy overall.

    Since I don't have much more time, I'd like to move on to another topic.

    One of the recommendations you had was that the Canadian Hydrographic Service should undertake more soundings and should produce new charts especially for the Canadian Arctic.

    Today the Commissioner of the Environment came out with a report that was pretty hard on the government. It says that Canada's northern strategy does not provide a vision for safe marine transportation. The report clearly states that none of the departments examined had a strategy in place to support safe marine transportation in the Arctic. This is especially worrisome because vessel traffic is increasing in the Arctic.

    Also, specifically with respect to the Canadian Hydrographic Service, the report states that many higher-risk areas are inadequately surveyed and charted. The assessment very clearly states that less than 25% of the paper charts in the Arctic are good. The Canadian Hydrographic Service estimates “that about one percent of Canadian Arctic waters are surveyed to modern standards”.

    Are you familiar with the recommendations that your organization made with respect to the Canadian Arctic?

    Yes, of course. I cannot say more than that, but we've been recommending for a number of years that the charts need to be updated to make sure they are up to modern standards and so on and so forth. We know the Arctic is huge and it is more difficult to chart there, but it's something that needs to be done and it's something that we've been relaying to the government on a regular basis.

    Very briefly, can you just quickly tell us why it's important to have updated information so we can understand in practice?

    It is because that's a basis. It is very difficult to navigate without charts. You need to have very good charts. It is even a legal requirement to have charts on board and to have the latest updated version. Those are actually the basics of navigation—to have a ship and a chart. You need to know where you are going. That's very basic. I don't know what else I can say.

    Thank you very much.

    We now move to Mr. McGuinty for seven minutes.

    Good morning, Ms. Legars.

    Mr. Buy, good morning.

    Ms. Legars, can I start with you very quickly?

    For your Shipping Federation of Canada members, is shipping traffic generally up or down?

    Yes, there's generally a big difference depending on how you count it. If it's by ships or by tonnage, the ships tend to become bigger and bigger, and therefore to carry the same tonnage you need fewer ships. But the tonnage is definitely up. The number of ships is going up too but less than the tonnage, because the ships are getting bigger.

    So the tonnage is up, the number of ships is up, and the number of voyages taken is up as well. Is that correct?

    Well, the number of ships and the number of calls are about the same thing. We count calls rather than ships.

    In 2013 you carried 47 million passengers and 17 million vehicles. Is that stable? Is it up?

    It's fairly stable. We saw a little decrease in 2011-2012. I think we're seeing a little bit of a pickup in 2013.

    Madam Legars, can you tell me whether the IMO inspector audits Canadian SOLAS vessels' safety management systems?

    The IMO doesn't audit. The IMO sets standards and conventions. The ones who audit regularly are the classification societies. This is also done by the flag state, and you have inspections at the ports where the inspectors as a part of port state control will check that you have everything in order.

    Who are they inspected by? Who inspects and audits the SMSs?

    The real audit is made according to the flag state to ensure it's being coordinated.

    So if the ship is flagged in Liberia, is it the Liberian government that's responsible for auditing and inspecting the ship?

    To make sure that it's being done, it is. That's why we have the port state inspections, because, you know, it is another pair of eyes in all the countries of the world that have no direct interest in the well-being of the shipowner in question. If you click on the link in the appendix that was forwarded to the clerk, when you see the various reports of Paris MOU, Tokyo MOU, U.S. Coast Guard, and Transport Canada ports, you will see, I would say, the record and the ranking and the benchmarking of the various flags. Some flags are more serious than others in terms of targeting, because when you inspect ships, basically you pick and choose the ones that will be priority for inspection, so this comes into the mix. So you have various white lists, grey lists, and black lists of ships depending on the MOUs.

    Thank you, I got that.

    I want to go to Mr. Buy for a second. Mr. Buy, the Canadian Ferry Operators Association is proceeding with its own voluntary SMS system. Is that correct?

    That's correct.

    First of all, I'll say that we have no ships registered in Liberia. All of them are registered in Canada, thank God, at this point.

    So you have no SMS system?

    No, we do have an SMS system, a voluntary system for operators. They are audited by the classification societies.

    Is that a government body?

    No, it's a government-designated body. It's for international companies.

    They're not, for example, Canadian regulators or inspectors—

    No, they're regulated by the Canadian government and designated by it to audit the safety management system when it comes. We also have Transport Canada inspectors.

    To both of you very quickly, I always like to turn to the budget numbers because the money never lies. Between 2011-12 and 2012-13, marine safety in Canada has been cut by 25%. A quarter of all funding for marine safety has been cut, from $75.6 million to $56.5 million. So here's the question. Given that we've had a quarter of the funding cut for marine safety in Canada by the federal government, can you help us understand? Ms. Legars, do you think that your overall regulation by Transport Canada is satisfactory? Do you think that there are est-ce qu'il y a des lacunes, or places where we need to improve, given that we've seen a 25% cut?

    Yes, I understand what you're saying. I have two things to raise.

    The first one is that enforcement is a collective game in terms of ocean shipping. Under these MOUs all the countries that are part of the MOUs have a certain target to reach. I don't know if I remember, but I think that under the Paris MOU Canada had 5% of enforcement effort to do for the enforcement of all these fleets that cover this common region. That's an international commitment that they have to do, and it's reported, and blah, blah, blah. That's one element of our response.

    The second one is that Canada has its own priorities. For example, under the Canada program every tanker has to be inspected for its first voyage in Canada and then at least once every year. Some funds have been frozen for that as part of the post tanker panel decision. The minister made a commitment that this money will remain.

    I don't understand something. It's plain common sense. You told me earlier that shipping traffic is up and increasing and the size of ships are increasing, but we've had a 25% reduction in overall spending on marine safety. How do Canadians square that?

    I don't know how they square it. The only thing I can say is that they have to do it under international commitments. They have no choice but to carry out the number of inspections they have undertaken to do. That's how it works. So I don't know how they square it, but just know that it's done.

    Okay.

    What's my time, Mr. Chair?

    You have 10 seconds.

    Mr. Buy, do you want to comment on that?

    I won't get into the debate on whether the 25% has resulted in fewer inspections or anything else. There may be efficiencies that were found and different things. That's for the government to debate and to argue.

    What I can tell you is that at this point we believe that Transport Canada is doing an adequate job on inspections. We're a little bit concerned about the obligation of certain authorities to the classification societies for smaller vessels, which is putting some strains on the smaller ferry operators. But I think in general the government has done an adequate job in the inspection on board ferries. I can speak in terms of ferries and I think they have done an adequate job.

    Thank you, Mr. Buy.

    We now move to Mr. Watson, for seven minutes.

    Thank you, Mr. Chair.

    Thank you to our witnesses for appearing.

    Ms. Legars, I'll start with you. With the global supply chain for handling goods, especially dangerous goods, there are a lot of hands that touch on or have an interaction with dangerous goods cargo. Can you walk us through, if possible, the various stages of who would touch upon these goods, and whom they report to, and whom they're regulated by, whether that's a consigner or the handlers and the stevedores in port who move the cargo—those who have carriage of the ship? Can you walk us through that a little bit so we understand at which point who is regulated by whom and who has oversight of it all?

    I will try to be brief. Everything that we—

    If it's a complex issue, you could submit to the committee in writing afterward. That would be helpful.

    Maybe I should submit it in writing, in graphic form. But basically, everything that is marine is clearly under the IMDG Code. Then when it comes to the interface with land in Canada, the Transportation of Dangerous Goods Act is triggered. The goods must always be identified and carry that documentation, and so on and so forth.

    But I will provide it in writing after the meeting, if you don't mind—maybe in a graphic format.

    That would be fine. We'd look forward to that, obviously.

    Marine shipping by tonnage, you stated earlier, is up. The number of ships and calls, if you will, are also at least marginally up.

    What is the safety record currently with respect to that mode of transport? Is it improving? Is it roughly the same?

    It's good. A key element was when the port state control regime came out about 20 years or so ago. It's been a very big driver of improvement in the quality of ships and the elimination of substandard shipping. The last data published on Transport Canada's website, for example, showed there were 1,033 inspections in 2011, including 358 tankers. There were 431 deficiencies, out of which seven were for dangerous goods and 63 were ISM Code ones. This led to 34 detentions, ships that were detained, of which two were tankers. That gives you an idea of what it means.

    Actually, the safety record is very good and is getting better and better. For some trade, especially the tanker trade, we've probably reached residual risk. At some point—I don't remember when it was; I think it was in this committee at the previous hearing—we had the data from ITOPF, an international organization gathering data on that, and it showed that really, the number of spills worldwide is at a very residual level.

    Global cargo, as I think you testified earlier, is in oil. Is that trend showing a marked increase, or is that relatively stable as well? Where do you expect that trend to go, and does that trend produce any additional risks we should be aware of?

    I will have to double check where we are in terms of oil trends. From the top of my memory, I would say it's pretty stable as far as Canada is concerned, in terms of volume. We may have changes in traffic, depending on whether we import or export more. I can do an update on that as well, as a follow-up.

    Now, the Transportation Safety Board has recommended since 2012 that safety management systems should be extended to all types of domestic commercial vessels. Do you agree with that, and if not, why?

    Is it a question for me?

    Yes.

    Well, we deal only with international vessels. All our ships are under foreign flags, so we haven't taken any position on whether Canada should do the same thing for all their domestic ships, whatever the type. Of course, the safety of each user of the waterways is somehow the safety of all, because we all share the same waters, so we can only encourage that. But we haven't made any.... It hasn't been our battle, I would say.

    Mr. Buy.

    We do agree that it should be expanded to all ships. I think the only issue is the auditing of that, and at this point, that often rests with the classification societies. It is not reasonable to expect the classification society to go for an affordable amount to a ferry that is offered at very low cost in northern Manitoba where you have to travel by plane, take multiple cars and, on occasion, a float plane and everything else, and charge a minimum amount. It's not happening.

    You said the concern—

    The concern is between the auditing, the regulation, and the real impact on the ground. There is some concern around that, and Transport Canada needs to do its job on that front.

    In those narrow instances for those particular—

    For those instances, yes.

    In the event of a spill on a ferry vessel, let's say a propane tank leaks, can you walk us through what emergency response on board a ferry would look like? What would you have to do?

    Well, there are a number of steps to be taken, for sure. It will depend on the operator and on the type of ship. Clearly, the crew and the captain are in charge. Instructions will be given to passengers. There would probably be an evacuation fairly quickly on that. There would be containment measures taken. There would be a number of steps taken to prevent a further catastrophe or a further disaster in that case.

    The responses are really governed by a set of codes and a set of manual procedures. I'll give you an example. One of our operators, B.C. Ferries, has a manual that is about 22 pages. It governs what you do in this situation, what you do in that situation, etc. Staff are trained for about three or four days, and I don't know if within the few minutes allocated I can walk you through everything in place. What I can tell you is that the response and the quality of the response will depend on the training provided and the awareness of the staff of the measures that are in place to contain the spill.

    Okay, thank you. We're out of time.

    Mr. Braid, you have seven minutes.

    Thank you very much, Mr. Chair.

    Mr. Buy, you mentioned in your presentation the example of the short-run ferry. You brought it up, and I wanted to give you the opportunity to fully put this on the table. There's some discrepancy in terms of definition, whether it's three kilometres or five kilometres.

    Here's a two-part question for you: why is the definition of a short-run ferry important and, in your mind, what should it be? Should it be three kilometres or five kilometres?

    The definition is important because if you define a short-run ferry and you use the term “short-run ferry” in one regulation and you use the same term in another regulation, but the definition is not the same, then you have a problem.

    The term “short-term ferry“ should refer to exactly the same thing in the same definition. If I'm an operator and I'm used to knowing that a short-term ferry is five kilometres and I apply this throughout my operation and then I look at the regulations and it says a short-term ferry uses x, y, and z, but this is three kilometres, and this is 2.5 or 2.2, it doesn't make much sense. This is why consistency in the regulation is important.

    To be frank about three to five kilometres, we think five kilometres was the intent. I think it was three miles. The hardship on certain operators in terms of the steps they have to take is such that we believe that five kilometres should be the appropriate point on that front.

    Thank you.

    Would you mind following up with the clerk, perhaps after the committee meeting, to just explain where that discrepancy appears in the regulations? That would be helpful.

    Absolutely.

    Madam Legars, you've taken the opportunity to explain to us how the international inspection protocol works. There are requirements under the domestic flag authority, if you will, and port authorities.

    I'm curious. Are there any inspections done in international waters and, if so, by whom?

    In any international waters, no... [Inaudible—Editor].

    Okay. Thank you.

    From your perspective, is Canada fully meeting its international commitments with respect to inspections in this regard?

    Yes, it is our understanding that Canada is meeting with international conventions and regulations in terms of inspections.

    Thank you.

    So there has been no decrease in inspections by Canada with respect to our international commitments?

    No, no.

    Thank you.

    How do the Paris and Tokyo MOUs evolve over time and what opportunities does Canada have to help shape what's in those MOUs?

    These are organizations where all the states that are parties to these MOUs meet regularly. Probably Transport Canada would be better to explain how it works internally, but the way that we understand it by reading their reports, for example, is that they have regular meetings.

    Sometimes it's technical if they discover there are some specific issues that need to be addressed. For example, they will decide that for the upcoming year they will target this or that type of deficiency in the world's regions. So there will be targeted inspections because they have a feeling that there is a trend in terms of deficiencies. But otherwise they meet on a regular basis and just exchange experience and all of that and decide to adjust their targeting, the methodology, or maybe the way in which they operate.

    What I understand from the outside, of course being the industry representative, we don't necessarily know how the work is managed internally under these MOUs, but Transport Canada probably would be able to tell you more on that because they're the ones participating in all these meetings.

    How frequent are those meetings? Do you have any sense as to their frequency?

    I know that all the MOUs issue an annual report, so they have an annual general meeting, should I say, but my understanding is that there are more frequent specialized or technical meetings. It's a network. It's something where people are connected to each other on a constant basis.

    Thank you.

    Finally, I wanted to ask you about the liability regime with respect to inspections and audits and holding particular ships accountable if there are violations. Could you briefly explain how the liability regime works, and then, as I understand it, you have some specific recommendations with respect to how to improve the liability regime. Could you explain those as well?

    Well, I don't know what you mean by liability. I think the third-party liability regime when you have a victim, for example, because there was a spill and there was pollution, is encompassed by international conventions that are brought into Canadian law via the Marine Liability Act.

    The last brick in this thing is the HNS convention which is an IMO convention and will be integrated in the Marine Liability Act via Bill C-3, which is now in the Senate. I don't remember when it was before you, but it was probably last spring or so. So this is the liability and it channels the liability to a ship owner who has to pay, and there is mandatory insurance, and when it reaches the top then you have the international fund kicking in. This is for third-party liability.

    If you have a deficiency, basically the port states will require that you fix it. It has to be fixed either on the spot, or if it's something that is not critical there may be a deadline. For instance, you might have to fix it before you reach the next port of call.

    If the deficiencies are critical and there is a danger, such as immediate danger to the environment or to the crew or to safety, then you have a detention. It means that your ship cannot move. It will stay here until things have been fixed and the port state authority is fine with it and says, okay you can go.

    Thank you very much.

    We'll now move to Ms. Morin, for five minutes—

    And it's on your record.

    Thank you, Mr. Chair.

    Good afternoon, everyone.

    Mr. Buy, I read on your website that you are concerned about the shortage of skilled workers who can handle the work and make sure conditions are safe. We haven't talked about skilled workers much yet today.

    Can you briefly describe the problems caused by this shortage?

    As far as our operators go, it is clear that there will be a shortage of skilled workers over the next few years. That will affect jobs on some ships. To discuss the problem, we organized a round table a few months ago that involved the colleges and universities that train our employees.

    Which ones, specifically?

    I'm talking about engineers, about the people in charge of safety on the ships, and especially machinists.

    There is going to be a labour shortage over the next few years. That's clear. We think it's important to invest now in training new workers for certain jobs so that we can make sure we have the workers we need to sail our ships safely.

    Ms. Legars, would you like to comment on that? I don't know if you've heard about the fact that there will be a shortage of skilled workers in the coming years.

    What can we do about that? Do you have any recommendations?

    Right now, we don't. Because our fleet is international, we recruit people internationally. Of course, if Canadian sailors want to work on international ships, they can, as can people of other nationalities.

    We have a hard time keeping people for the long term in this industry and recruiting ships' officers who will stay long enough. After a number of years, people leave the industry to go work on shore. That's not necessarily a typically Canadian problem.

    What can be done to retain these people? Why do they leave these jobs? Every time they leave, their expertise is lost. I imagine that has an impact on safety.

    We are trying to promote careers at sea. Practices are changing in the way ships are managed. For example, there are contracts and shorter crew rotations so that people can go home more often.

    We think it's important to promote careers at sea and present them as a good option. It's very well paid, and it leads to a broad range of careers on land afterward, including ship inspection, work with classification societies and logistics at various terminals. Some former captains work there and do load planning, for example. Career development and opportunities can be very good. That's the message we want to get to young people.

    Thank you.

    You have various committees, such as the tanker safety expert panel, which was created in the fall of 2012 and completed the first phase of its work in 2013.

    One of the committee's findings was that Canada's level of preparedness and ability to respond to a spill should be risk-based depending on the region that oil products are traversing and on possible spill scenarios developed at the area level, not the current uniform approach.

    Can you comment on that and make some recommendations?

    Yes.

    We supported that recommendation because our belief is that all safety and incident response issues should be based on risk analysis anyway. We have no objection to the expert panel's recommendation, especially since the type of traffic can change. There are oil tankers in places where there weren't before, and there are fewer tankers in places where there used to be more. Traffic changes, so it makes sense for incident response scenarios to change too.

    We fully supported that recommendation. We just want the overall thinking and methodology to be consistent across Canada. We don't want all kinds of micro-regional approaches. Every risk is local, but the intellectual approach to risk management should be the same across Canada. Our position is the same on many issues, actually.

    Thank you very much.

    We'll now move to Mr. Komarnicki for five minutes.

    Thank you, Chair.

    I have a couple of questions.

    First of all, with respect to the International Maritime Organization Code and the Canadian transportation of dangerous goods regulations, are there differences, and, if there are, which prevails or has predominance in a particular area?

     Are you able to say, Ms. Legars?

    Sorry, I lost part of it.

     Could you restate your question, please?

    It's dealing with the international marine organization code and the Canadian transportation of dangerous goods regulations.

    Are there differences, and, if there are, which supersedes or takes precedence?

     With respect to our ships, the Canadian regulations do import the UN IMO Code, so there are no differences. That's pretty much the same as far as our ships are concerned, so we have no issue with that.

    All right.

    Now with respect to the safety management systems, are you able to say what the effect of the introduction of safety management systems has had?

    It has helped to implement a philosophy of continuous improvement and the culture of safety, so it has been a useful tool in helping that.

    Have there been any issues with regard to transition to safety management systems in addition to the regulations?

    I remember when this was introduced about 15 years ago, everybody pulled their hair and said this was so difficult, so much paper, so much process. It was seen as very burdensome. However, after it was implemented and people started to work with it, they realized they could do it and it was useful. Now it's not an issue any longer.

    Of course when it's introduced it's always difficult and burdensome, but it has been running for about 14 or 15 years now and it's a non-issue.

    The parliamentary secretary mentioned that there are different handlers of dangerous goods, both on the ground, I suppose, and on the vessels—loading the vessels. There may be different responsibilities, but safety training would be a significant issue.

    Does your federation involve itself with respect to training?

    Yes. Actually, on our side, the training we are providing to our members is the basic dangerous goods training. Under the Transportation of Dangerous Goods Act, any entity that deals with the transportation of dangerous goods has to make sure that all employees have appropriate training. Depending on what the employee does, the training will be different. So you have some kind of basic training, which is a kind of general culture on what dangerous goods are and what the various classes are, and things like that. Then you have people who are really involved in the actual handling of specific products who will have a more detailed training. What we have proposed to members is that they can go with various service providers, because you have many companies that specialize in education and also provide this training.

    What we provide to members is the basic training, for when they are clerks or people who are not necessarily working in dangerous goods handling, things like that, so that they know there is a specific regime for dangerous goods handling, and so on and so forth. We have a basic one-day course. But in addition to that, the members will have to train their own people who do some specific handling to make sure they have the appropriate knowledge and, if necessary, certification.

    Do you provide any protocol or basic standards that are required with respect to such training? Or do you provide your members with the bottom line?

    No, we don't do that. For example, if our members want container lines and are involved in [Inaudible--Editor] transportation, they will have to have their own training with specialized trainers to make sure that their people know that. Anyway they will have worldwide protocols, guidelines, and procedures that will apply in all the countries where they deal. So we are not involved in that.

    What we propose is really a one-on-one session for whoever, say a new clerk that you have just hired and need to have this kind of global knowledge. That's what we do.

    Thank you.

    I'll now move to Mr. Sullivan for five minutes.

    Thank you, Mr. Chair.

    Thank you to the witnesses.

    Mr. Buy, is the association responsible for the transportation of any rail over water, or is it only people and cars? The rail transportation is by barges run by railroads, not by your association?

    Yes.

    But you do transport trucks. One would presume that the majority of the dangerous goods transported would be somewhere on some of those trucks. How much do you know about what is transported? How much data can you give us about the tonnage of dangerous goods transported on ferries?

    It's hard to provide the data. We're actually assembling the data as we speak, and we're getting some information on that. Transport Canada has the data, because it is something that we have to report. It is something that Transport Canada would have.

    You're correct in saying that if there are trucks going on our ships, some of them do include dangerous goods, hence the protocol's in place to deal with them.

    Is the protocol in place so that you know what's on the trucks before they get on?

    Yes, we have to know what's on the trucks before they get on it.

    As I mentioned, and I gave you a little hint, we have to rely on the voluntary declaration by the truck drivers. Although we do our own inspections on occasion, we do rely on what is said for some of them. We, on occasion, have to rely on the honesty of some of the people who fill in the declarations.

    Does Transport Canada ever inspect those trucks themselves?

    There are some inspections of trucks. I don't know if it's by Transport Canada or the provincial ministries of transportation, but there are some inspections. What we would like to see is a little bit more inspections of trucks prior to their coming on board our ships.

    Because if it's voluntary and they don't tell you—

    The voluntary aspect is a bit difficult.

    Yes, because if you don't know, you can't be prepared for it.

    Well, you can be prepared to a certain extent. I don't want to leave the impression that if something happens we don't know what to do. We do know what to do. The issue is that if something happens, it's much easier to a situation that you know may happen, rather than be surprised because there is something in there.

    Do you make a habit of putting the dangerous goods in specific places on the ferries? Is that part of—

    Yes. Depending on the ship, there is a certain protocol of where they're going to be, how they're going to be dealt with, etc.

    Is that protocol set by Transport Canada or by the ferry owners themselves?

    There are protocols set by Transport Canada and there are further protocols set by various companies on top of that.

    But again, it requires a voluntary.... You have to know what's in the truck to know where to put it.

    Absolutely.

    For you, Ms. Legars, with the handling of dangerous goods, again I assume you're going to know what's on each vehicle. Is that information conveyed to the handlers at the ports and to the municipalities themselves, so they know what's going through their towns?

    Yes, actually the ports and the terminals have all the information in advance. Not to [Technical difficulty--Editor] and so on and so forth. I don't know if they have it but it's certainly not something that is handled by the ports. The ship provides information to the port and terminals and to all the people who will be handling this cargo. So if it goes after that on a truck or a rail car, the train or the truckers will have the information. The information always follows the flow. We don't provide this information to the cities or to whomever. It's not something that is in the regulations, so I don't know how it's managed outside the port and outside of the stakeholders who are directly involved with the handling of these goods.

    Do you have the same difficulty that the ferry owners have about the honesty of the shippers?

    Well, that's something, you know, especially on the containers. On the bulk side, you know pretty much what you have in your ships' holds because very often you have surveyors, for example, when the things are put in the holds and you may have some testing or whatever. But when it's in containers you rely on what the shippers said and you rely on the documentation that the shipper provides, because they are the ones who put the things in the containers and seal the containers. After that you basically have to trust the information you have received.

    Does Transport Canada do routine inspections or random inspections of these containers, or is that left to the shipowners themselves?

    The shipowner does not make routine inspections of the containers. The only ones who will do inspections of containers are the customs administrators. They are the ones who can open containers.

    How often--

    The Chair: Your time is up, Mr. Sullivan.

    Mr. Mike Sullivan: Oh, I'm sorry, I'm out of time.

    Mr. Sullivan, you're quite a bit over actually.

    Mr. Leung, for five minutes.

    Thank you, Chair.

    My question is for Ms. Legars.

    In the United States they have an organization called the American Bureau of Shipping, and in London, I believe, there is Lloyd's that does ship inspections and certifications. Do we have an organization similar to that in Canada?

    Do you mean a classification society?

    No, an independent organization like the American Bureau of Shipping or Lloyds in London? What is our closest organization in Canada that does that type of work?

    Well, actually the companies you named are classification societies. In Canada we have all the worldwide classification societies, and all the reputable ones are part of an international association where all reputable shipowners want to find their classification societies. We don't have a pure Canadian one. They are all international companies, even if some of them have a name like American Bureau of Shipping that you think is American. Actually, it serves people all around the world and they may have offices all around the world, too.

    So we don't have something that's purely Canadian but rely on international certification organizations to do this work.

    My next question, then, has to do with marine liability.

    Are liability limits established by international convention, or is there a specific liability that Canada establishes for our close-shore liabilities for accidents or oil spills?

    That's international. Those are international conventions, and then they imported into Canadian law via the Marine Liability Act.

    So we're relying on the international network of organizations for us to meet our standards or meet our requirements for our marine liability?

    Yes.

    Well, the standards are actually the limits of liability and the access to the international funds, because you have access to international funds when you reach excess liability.

    Okay. Thank you.

    My next question is for Mr. Buy.

    Ferry transport is a very specific type of transport. The vessels are point-to-point or shore-to-shore, regardless of whether it's within 5 kilometres, 10 kilometres or even 30 or 40 kilometres. If that's the case, then would we not be better off to have a specific act that controls and governs the operation and safety of ferry operations?

    It's an interesting question. When Minister Raitt came to our meeting last week, to our annual conference, she certainly made a clear statement that she recognized the importance of the ferry sector. The fact that the operation of ferries is regulated by acts that regulate anything from the transportation of trailers, of different things, is something that we may want to look at and see whether or not an act specific to the ferries is relevant.

    You mentioned that ferries go point to point, from a few hundred metres to a few kilometres, to 30 kilometres. It's actually much more than that, as some of them go hundreds of kilometres. You've got ferries from North Sydney to Argentia, in Newfoundland, and you've got the Northwest Passage and B.C. Ferries that go from the north of Vancouver Island to Prince Rupert. That's a lot of kilometres to cover. The difference, when you have the little ferry that goes to the Toronto Island airport, which is the shortest ferry in the world, to the Marine Atlantic ferry, is that they're very different operations. So I don't know if we can do that.

    Let me reframe the question, because ferry operation itself is unique in a way. The vessels that are designed for it are actually point-to-point vessels, unlike ocean-going vessels or cargo or traffic vessels, which can land in any port, say, along the St. Lawrence Seaway or internationally. Because of that unique character, it usually serves not more than two or three ports.

    Would we not then better off, then—well, not necessarily better off—or be more specific if we addressed this issue with a specific act?

    I'm not convinced of that, sir. I think we have some ferries that actually cover a number of ports. I think it's the port that has adapted to the ferry, not the ferry adapted to the port. I think you may see a new ferry brought into service in Atlantic Canada very soon, which is probably done in Europe. It will come here, and if the adaptation is done, the adaptation will be done to some of the ports, and maybe a little bit of the ship, but not by a huge amount. I don't think that the specificity of the vessel is the issue. I think the issue would be the specificity of the services it provided. You're dealing with passengers. You're dealing with people. When your family embarks on a ferry, they want to be safe. When you've got kids, you've got seniors, you've got different people, you've got people going back to their homes, they want to be safe, and that's where—

    Very good.

    One of my colleagues mentioned that some ferries are used for transporting cargo, rail, whatever, Then in a way that comes under the whole shipping industry, whether you transport passengers, rail, cargo. I don't think we normally transport liquid bulk by ferry, but we certainly do it via containerized and palletized bulk.

    Do you have a final comment?

    No, I think that's good. Thank you.

    Thank you.

    The last question goes to Mr. Yurdiga, and welcome to the committee.

    Thank you very much.

    According to the Transportation Safety Board, over the past 10 years there has been a decline in the number of marine accidents, which include shipping accidents and accidents aboard vessels.

    Is this attributed to regulations, safety management systems, or is it an advancement in technology that assists in preventing these accidents?

    A safety management system is something that we're promoting and pushing and saying is important and should be implemented everywhere, but people have a tendency to think that because you've devised a system, everything will be solved.

    You're dealing with people operating ships. You're dealing with individuals and when you have an accident you're always dealing with issues involving human error. That's often what's happening.

     I think the reduction in accidents is often due to training and awareness of issues, and I think that's where you're seeing that. You can regulate and over-regulate a sector. I'm not entirely sure that's always the healthy thing to do. In my presentation I mentioned that if there were one thing we were griping about a little, it is that the regulations are not very clear and on occasion confusing. A review of the regulations is really warranted to make them a little clearer. If that were the case, I think it would help.

    So it's really due to training that you're seeing a reduction in the number of incidents.

    Thank you. I have no further questions.

    Mr. Watson, do you want to use the rest of his time?

    Yes, I have a couple of additional questions.

    Do ferries have the right to refuse any specific cargo?

    They do and they often do, yes.

    That's different from rail.

    Based on some of your testimony about the difficulties of voluntary disclosure of truck cargo, Mr. Sullivan asked whether Ms. Legars's industry has a problem with the honesty of truckers.

    I want to be clear whether the issue of disclosure is one of honesty by truckers, or are we talking about perhaps not knowing what the cargo is, or the paperwork they carry not being specific such that a truck driver might not know what's on board?

    Honestly, it could be any of the three. I'm not pointing a finger in one direction specifically, but in terms of your first question, if we have the right to refuse, the policy for the majority of our operators is that “if you don't know, they don't go”. If you don't know what's in there or you're not sure, they don't go on board, and I think that's important for the safety of our passengers.

    Okay, we're down to a few minutes, so Ms. Legars and Mr. Buy, if there's something that wasn't brought up today that you think the committee should hear, I'll give you a couple of minutes each to do that.

    Ms. Legars, I'll start with you.

    I don't have a specific message to pass along. We are internationally governed, and it's important for us that it remains so, for consistency reasons. It's a key element, I think, in why the regime is successful, as the stats and very low number of incidents show. The reason, first of all, is that it's international and consistent, not only in the regulations themselves but also in the enforcement. I think that the network enforcement that we have under the MOUs has proved to be a very efficient way to enforce and to make sure that the coastal states have a better grasp of the ships that come to their coasts, and to make sure that the global fleet gets better and better every year.

    Thank you very much.

    Mr. Buy.

    Just briefly, I provided the example of the three to five kilometre issue. There are some other things that we can certainly talk about, for example, personal liquid oxygen for people who have breathing issues. Technically, that's only supposed to be allowed on a ship if hooked up to a person. The problem is that on some of those trips, the person will have an extra tank available in case there's an issue. Technically, that's not allowed. That's a significant problem.

    There are even problems on what an ambulance contains and whether it can or can't go on certain ships. There are a few things with the regulations that we may want to look at, and we certainly would appreciate a review and further discussion with Transport Canada on this.

    Transport Canada is going in the right direction with regard to reviewing certain things and making sure that there is a good attempt to look at whether or not some of the regulations are properly done. Further dialogue on this would be helpful.

    Just on your comments there, the one about somebody who uses oxygen, there are lots of people travelling and there must be a practical or common sense solution for that. Obviously, leaving the extra tank behind is not an option, so the different ferry operators must have some kind of protocol to see that they're allowed to bring on the extra tank, but in a safe manner.

    Is that a fair statement?

    Yes, the operator will actually look at making sure it's done in a safe environment, and that's what we've seen happening. But if you look at the actual regulation, in the actual rules, it's not supposed to happen. That's where you can have a little bit of concern on that front.

    Again, it's always that you have the regulation in writing, which looks nice, and then you have the implementation on the site, which on occasion would benefit with tweaking.

    Thanks again for taking the time to join us here, Mr. Buy and Ms. Legars.

    The meeting is adjourned.