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BC can't restrict oil shipments through its borders, court rules

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Eric Zimmer May 24, 2019 10:31 am

British Columbia cannot restrict oil shipments through its borders, the BC Court of Appeal has ruled.

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The ruling on Friday comes after the provincial government sought to legally establish that it had the legal authority to do so.

It did so through the submission of a reference question to the BC Court of Appeal last year to affirm the province’s right to “protect the province from the threat of a diluted bitumen spill.”

The government said the reference question concerned provincial autonomy, particularly the rights of British Columbia to regulate the environmental and economic impacts of heavy oils, like diluted bitumen, transported through the province.

“We have asked the courts to confirm BC’s powers within our jurisdiction to defend BC’s interests, so that there is clarity for today and for the generations to come,” said BC Premier John Horgan, at the time.

In summarizing her decision on Friday, Justice Mary Newbury wrote that the amendment was targeted legislation that in “pith and substance” relates to the regulation of an interprovincial (or “federal”) undertaking — in this case, the expanded interprovincial pipeline of Trans Mountain Pipeline ULC and Trans Mountain Pipeline LP – which is intended to carry “heavy oil” from Alberta to tidewater.

Newbury acknowledged that “the protection of the environment is one of the driving challenges of our time.”

However, this particular reference, she stated, “is not about whether the planned Trans Mountain pipeline expansion should be regulated to minimize the risks it poses to the environment — that is a given.”

Rather, this particular reference “asks which level or levels of government may do so under our constitution.”

Newbury stated BC “readily acknowledges that the pipeline is an interprovincial (and therefore “federal”) undertaking.”

She added “it asserts that the expansion and operation of the pipeline as a carrier of heavy oil will have a disproportionate effect on the interests of British Columbians, as compared with other Canadians.”

The province “sees the proposed addition to the Environmental Management Act as relating to “Property and Civil Rights in the Province” or “Matters of a merely local or private Nature,'” in relation to the Constitution Act, she wrote.

Canada on the other hand, “characterizes the addition as relating to the “matter” of “Works and Undertakings connecting the Province with any other or others of the Provinces, or extending beyond the Limits of the Province.”

She wrote that although Canada acknowledges that provincial environmental laws may affect interprovincial undertakings, “the proposed addition is targeted legislation and would effectively lead to a situation of concurrent jurisdiction, contrary to the exclusive authority contemplated by the Constitution Act.”

“The amendment thus lies beyond provincial jurisdiction,” she wrote.

BC government responds to decision

In total, the BC government sent three separate reference questions to the BC Court of Appeal.

However, because the court found that the core of the law was directed at product coming in through an interprovincial pipeline – and that BC couldn’t regulate this – they were not required to provide an opinion on the other questions.

Just hours after the court ruling, BC Attorney General David Eby spoke about what he called a disappointing decision.

“Our government said from the outset that we would stand up for British Columbia’s environment, our economy, and our coast,” he said. “Thousands of jobs and billions of dollars in economic activity would be out at risk by a diluted bitumen spill.”

Eby said that while the provincial government is disappointed with the decision, “we strongly believe the court has an important role to play in upholding the rule of law.”

That, he continued, “is why we referred this case to the court system in the first place; our government always said this case would likely be heard before the Supreme Court, and in fact, we asked the federal government to join us in a direct reference to the Supreme Court of Canada.”

Eby said the BC government continues to believe “that we have the authority and the responsibility to protect our environment and economy, and so we will be exercising our right to appeal to the Supreme Court of Canada.”

Asked about the optics of the BC government taking their case to the highest court in the country, following a unanimous ruling by the BC Court of Appeal that wasn’t in their favour, Eby was asked about the continuing costs to taxpayers in this ongoing legal battle.

“In terms of the financial costs of going to court to clarify this question, to clarify the extent of our jurisdiction, it is a fraction of a fraction of the cost of a catastrophic diluted bitumen spill in terms of the impacts on economy, on jobs, and just cleaning up the mess,” he said. “We think its worthwhile – in terms of clarifying our ability to protect British Columbians from this catastrophic outcome.”

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