Government Briefing Bulletin

Update: Nuclear Liability and Compensation

Bill C-15, An Act respecting civil liability and compensation for damage in case of a nuclear incident, was introduced in the House of Commons on April 16, 2010, by the Honourable Christian Paradis, the Minister of Natural Resources. Bill C-15 is the federal government’s fourth recent attempt to update Canada’s regime of civil liability for nuclear incidents.

Bill C-15 establishes a specific civil liability regime for nuclear incidents and repeals the Nuclear Liability Act (NLA) which previously provided for such a regime. Like the NLA, Bill C-15 makes the operators of nuclear installations exclusively liable, but increases significantly (from $75 million to $650 million) the extent of their liability and the financial security that they are required to maintain. It also provides for the establishment of a special Tribunal to hear and decide claims.

Bill C-20, the predecessor to the current Bill C-15, had just been amended by the Natural Resources Committee on December 10, 2009, when Parliament was prorogued and therefore it died on the Order Paper. The political parties did not agree to restore it to its previous position, and so Bill C-15 is now working its way back through the legislative process. Bill C-15 has been the subject of debates at Second Reading on May 13th and 14th, 2010. It is anticipated that the Bill will receive Second Reading shortly, after which it will proceed to the House of Commons Natural Resources Committee for further study, likely beginning in early June.

It currently appears likely that Bill C-15 will not receive quick legislative passage. The NDP have indicated that they intend to have speakers address the Bill at Committee. In addition, it appears that the Liberals wish to revisit the $650 million liability limit. Moreover, the NDP pointed out during last year's committee hearings on Bill C-20, that the Nuclear Insurance Association had indicated that a pool of $1 billion of insurance was possible.

As a result of the recent Gulf of Mexico oil spill, the issue of energy company liability as it relates to offshore oil drilling has been a topic of interest at a number of parliamentary committees, including the Environment and Sustainable Development Committee of the House of Commons. Nathan Cullen, the NDP critic for energy and natural resources, recently appeared in the media stressing the need for more stringent environmental assessments as well as the need for clear energy company liability with respect to environmental disasters.

No doubt, the issue of energy company liability will be raised by the NDP during hearings on Bill C-15. While the Liberal and Bloc have been supportive of passing this legislation, their positions with respect to this legislation and the notion of increased liability for nuclear companies may change as a result of the manner in which the politics surrounding the Gulf of Mexico oil spill continue to play out.

Clients with an interest in this legislation are encouraged to explore the range of legal and advocacy advice our energy and government relations experts at Gowlings can provide.

By: Jacques J.M. Shore

Chris Schafer

Henry Brown, Q.C.