What We Heard Report on Regulatory Reviews and modernization stakeholder consultations
Notice to Readers
This report reflects the input received from stakeholders prior to the COVID-19 pandemic and may not fully reflect their current positions. As it is being posted a year after the date of the consultation, the Government of Canada may have already taken action on some of the initiatives outlined in the report. See the Modernizing regulations web page for updates on regulatory modernization initiatives.
Background: Regulatory Reviews
In 2017, the Advisory Council on Economic Growth published a report entitled Investing in a Resilient Canadian Economy. The Advisory Council said that Canadian regulations should be agile and adaptive enough to ensure health, safety, security and environmental considerations without imposing barriers to innovation and competitiveness on Canadian businesses.
In response to the Advisory Council’s recommendations, Budget 2018 made regulatory modernization a priority by announcing that the Government of Canada would fund “targeted reviews, over the next three years, of regulatory requirements and practices that are bottlenecks to innovation and [economic] growth.” The first round of targeted regulatory reviews focused on 3 high-growth sectors:
- agri-food and aquaculture
- health and bio-sciences
- transportation and infrastructure
The Treasury Board of Canada Secretariat (TBS) is coordinating the targeted Regulatory Review process with federal departments and agencies. A central feature of the Regulatory Reviews is engaging stakeholders, including businesses, Canadians, and academia. Throughout the spring, summer, and fall of 2018, consultations were held to support the Government of Canada’s agenda of ensuring that regulations remain flexible and agile to support economic competitiveness.
Stakeholders were asked to provide their feedback in order to:
- identify regulatory irritants and bottlenecks to economic growth and innovation
- explore ways for regulations to be more agile to keep pace with emerging technologies
- ensure that Canadian businesses can grow, and all Canadians can benefit from new opportunities
Overview of consultations
TBS led an extensive national engagement exercise on the first round of Regulatory Reviews with impacted stakeholders over the summer and fall of 2018. This included an online public consultation that was posted in the Canada Gazette, Part I. TBS received more than 140 written responses from businesses, industry associations, academia, and Canadians.
TBS, along with implicated federal departments and agencies, also met with numerous stakeholders through individual meetings, round-table workshops and webinars.
Throughout these consultations stakeholders identified issues and irritants resulting from existing regulatory requirements and practices. They also provided suggestions for proposed solutions, and identified opportunities for regulatory experimentation.
What we Heard
The following report is a summary of the stakeholder engagement on the targeted Regulatory Reviews that took place during the spring, summer and fall of 2018.
This report is not meant to be an exhaustive list of all issues raised. Rather it represents a high-level synopsis of the broad themes that stakeholders raised as part of the online Canada Gazette, Part I public consultation. Further, this report highlights some of the broad regulatory impediments to economic growth, competitiveness and innovation that departments and agencies will be considering when developing plans to modernize regulations. These plans are referred to as sectoral Roadmaps.
Some potential early actions in response to stakeholder feedback on the Regulatory Reviews were announced in the 2018 Fall Economic Statement, and additional actions will be outlined in sectoral Roadmaps that will be published in 2019.
Horizontal Issues
Throughout the consultation process, stakeholders consistently raised several issues that cut across and affect all sectors.
The following 6 horizontal issues emerged:
1. Regulatory modernization and greater regulatory agility are needed
Several stakeholders indicated that many regulatory frameworks are out of date, and do not reflect current business models or practices. They perceived certain regulations as being overly prescriptive rather than being focused on outcomes. They also noted that regulations do not always take a risk-based approach, and do not always take into account the reality of the industry that is being regulated.
Taken together, stakeholders expressed that many current regulatory frameworks are ill-equipped to respond to current and emerging technologies. Stakeholders recommended modernizing regulations and ensuring that they are agile enough to accommodate and adapt to future technologies.
2. Engagement with stakeholders should increase
Stakeholders indicated a need for increased and ongoing engagement between regulators and regulated parties and are seeking more open and meaningful engagement with regulators.
Stakeholders expressed a desire for earlier involvement in the regulatory process. This includes being engaged before pre-publication of draft regulations in Canada Gazette, Part I. Stakeholders also want to be engaged to identify key regulatory considerations that may impact instrument choice. Further, stakeholders seek opportunities to provide details on how industry works in order to optimize the implementation of regulations.
3. Economic competitiveness and the cumulative impact of regulations must be considered
Some stakeholders expressed concern that the economic impact of regulations and regulatory management practices are not always considered by regulators. In particular, the impact of regulations on small and medium-sized businesses and smaller marketplaces is not always taken into account, which can lead to regulatory obstacles for those businesses.
Stakeholders identified the need for more risk-based regulatory approaches that ensure health, safety, security, and protection of the environment while also supporting economic competitiveness. Further, some stakeholders also expressed concern regarding the degree of transparency when departments and agencies conduct their cost-benefit analysis.
There is a desire from industry to assess the impact of proposed regulations on the competitiveness of Canadian businesses, and to consider the cumulative impact of regulations.
4. Regulatory management is important
Several stakeholders indicated that there is a need for greater clarity and guidance on existing regulations. They want more predictable and faster service standards and more streamlined and efficient processes. In addition, they are seeking greater use of digital tools, and acceptance of trusted third-party standards.
These are some of the suggestions identified by stakeholders as ways to streamline regulatory processes and more efficiently manage regulatory frameworks.
5. Regulatory cooperation and harmonization must be further considered
Stakeholders noted that misalignment within Canada (for example, between provinces and territories), and between other international jurisdictions increases unnecessary burden on industry. It can also be a barrier to trade, competitiveness, and growth.
Except when there is a justifiable case for differences, stakeholders recommended alignment between the federal, provincial, and territorial governments, and with other international jurisdictions or standards, to the extent possible.
6. There should be innovation through experimentation
Stakeholders noted that emerging technologies do not always have effective paths to market through existing regulatory frameworks (for example, remotely piloted aircraft systems, or advanced therapeutics).
In some cases, stakeholders noted that the development of guidance and use of pilots or testing are needed first to determine whether regulations are required, and subsequently, the appropriate level of regulatory oversight for a new innovation.
Stakeholders expressed a desire for the increased use of novel approaches and regulatory experimentation, whether through specific pilots, regulatory sandboxes, or other approaches to prepare for and respond to emerging technologies.
Sector-Specific issues
In addition to the horizontal themes, sector-specific issues were also identified for the 3 initial targeted Regulatory Review sectors. These include agri-food and agriculture, health and bio-sciences, and transportation and infrastructure.
Agri-food and aquaculture
Through the Canada Gazette consultation process, stakeholders submitted 60 written responses to the Agri-food and Aquaculture Regulatory Review. There were also 13 cross-sectoral submissions that identified issues, some of which identified issues in this sector.
Specific issues included the following:
