Security Screening Services Commercialization Act (S.C. 2019, c. 29, s. 270)

Short Title

Marginal note:Short title

1 This Act may be cited as the Security Screening Services Commercialization Act.

Interpretation and Application

Marginal note:Definitions

• 2 (1) The following definitions apply in this Act.

  Agency

  Agency means the Canadian Transportation Agency. (Office)

  designated screening authority

  designated screening authority means the body corporate designated under section 7. (administration de contrôle désignée)

  Minister

  Minister means the Minister of Transport. (ministre)

  screening contractor

  screening contractor means a person or entity authorized under section 21 by the designated screening authority to conduct screening. (fournisseur de services de contrôle)

  screening officer

  screening officer means an individual who is employed by the designated screening authority or a screening contractor to conduct screening. (agent de contrôle)

  state aircraft

  state aircraft means an aircraft, other than an aircraft operated for commercial purposes, that is owned and operated by the government of a country or the government of a colony, dependency, province, state, territory or municipality of a country. (aéronef d’État)

  transfer date

  transfer date means the day specified as the transfer date in an agreement between the Canadian Air Transport Security Authority and the designated screening authority. (date de cession)

• Marginal note:Words and expressions — Aeronautics Act

  (2) Unless the context requires otherwise, words and expressions used in this Act have the same meaning as in the Aeronautics Act and aviation security regulations.

Marginal note:Publishing

3 Any obligation under this Act for the designated screening authority to publish information or a document is satisfied if

• (a) the information or document is published on its website; and

• (b) the information or document is made available on request at its head office.

Marginal note:Aeronautics Act

4 Nothing in this Act affects the application of the Aeronautics Act.

Marginal note:Exception

5 This Act does not apply in respect of any aerodrome or aircraft operated by or under the authority of the Minister of National Defence.

Her Majesty

Marginal note:Binding on Her Majesty

6 This Act is binding on Her Majesty in right of Canada or a province.

Designated Screening Authority

Marginal note:Designation

7 The Governor in Council may, by order, designate a body corporate incorporated under the Canada Not-for-profit Corporations Act as the designated screening authority for the purposes of this Act.

Marginal note:Not an Agent of Her Majesty

8 The designated screening authority is not an agent of Her Majesty in right of Canada.

Marginal note:Head office

9 The designated screening authority must have its head office in Canada.

Marginal note:Official Languages Act

10 The Official Languages Act applies to the designated screening authority as if it were a federal institution.

Marginal note:Canada’s international obligations

11 The designated screening authority must take any measure that the Minister considers necessary to permit Canada to meet its international obligations under bilateral and multilateral agreements in respect of aeronautics.

Marginal note:Amendment of articles of incorporation

• 12 (1) The designated screening authority must not amend its articles of incorporation without the prior written approval of the Minister.

• Marginal note:Amendment or repeal of by-laws

  (2) The designated screening authority must not amend or repeal a by-law or any part of a by-law that requires the Minister’s approval to amend or repeal without the prior written approval of the Minister.

• Marginal note:Inconsistency

  (3) The designated screening authority must not make a by-law if that by-law would be inconsistent with a by-law or any part of a by-law that requires the Minister’s approval to amend or repeal. The designated screening authority must not amend or repeal a by-law that does not require the Minister’s approval to amend or repeal if the amendment or repeal would be inconsistent with a by-law or any part of a by-law that requires the Minister’s approval to amend or repeal.

Marginal note:Financial statements

13 The designated screening authority must, after the end of each financial year but before its next annual meeting of members, publish its audited financial statements for that financial year and provide the Minister with a copy.

Marginal note:Service standards

15 At least once every year beginning on the first anniversary of the transfer date, the designated screening authority must, in respect of each aerodrome that is designated by the regulations and at which more than 500,000 passengers emplaned in the previous year, publish service standards with respect to the screening of passengers, a report on average monthly passenger wait times and a report on the results of passenger satisfaction surveys.

Powers of Minister

Security Screening Services

Charges

Imposition and Establishment

Marginal note:Establish, revise or terminate charges

25 The designated screening authority may establish, revise or terminate charges.

Marginal note:Charging principles

• 26 (1) The designated screening authority must observe the following principles when it establishes, revises or terminates charges:

  • (a) that charges must not be set at levels that, based on reasonable and prudent projections, would generate revenues exceeding the designated screening authority’s current and future financial requirements related to security screening services made available or provided under section 18 at aerodromes designated by the regulations;

  • (b) that charges must be established, revised or terminated in accordance with an explicit methodology — that includes any conditions affecting the charges — that the designated screening authority has established and published;

  • (c) that, unless authorized by the Minister, charges imposed under paragraph 24(1)(a) must be the same in respect of all passengers, except that the designated screening authority may impose different charges based on whether passengers are travelling from an aerodrome within Canada to an aerodrome within Canada, from an aerodrome within Canada to an aerodrome within the United States or from an aerodrome within Canada to an aerodrome outside of Canada, other than an aerodrome in the United States;

  • (d) that charges may be used only to recover costs for security screening services made available or provided under section 18 at aerodromes designated by the regulations;

  • (e) that charges must be structured in a way that does not differentiate between Canadian air carriers and foreign air carriers, among Canadian air carriers or among foreign air carriers;

  • (f) that charges must be consistent with Canada’s international obligations in respect of aeronautics;

  • (g) that charges should be structured in a way that prioritizes aviation security and the competitiveness of the air transportation system.

• Marginal note:Financial requirements

  (2) For the purposes of paragraph (1)(a), financial requirements include the following:

  • (a) operations and maintenance costs;

  • (b) management and administration costs;

  • (c) debt servicing requirements and financial requirements arising out of contractual agreements relating to the borrowing of money;

  • (d) capital costs and depreciation costs on capital assets;

  • (e) financial requirements necessary for the designated screening authority to maintain an appropriate credit rating;

  • (f) tax liability;

  • (g) reasonable reserves for future expenditures and contingencies;

  • (h) other costs determined in accordance with accounting principles recommended by the Chartered Professional Accountants of Canada or its successor or assign.

• Marginal note:Deduction

  (3) For the purposes of paragraph (1)(a), an amount equal to the aggregate of the following amounts is to be deducted from the designated screening authority’s financial requirements:

  • (a) all grants and contributions received by the designated screening authority;

  • (b) all transition period payments referred to in section 59 received by the designated screening authority;

  • (c) all interest and investment income earned by the designated screening authority;

  • (d) all profits earned by the designated screening authority, other than in respect of security screening services made available or provided under section 18 at aerodromes designated by the regulations.

• Marginal note:Methodology

  (4) The methodology referred to in paragraph (1)(b) must include

  • (a) the amount of each charge;

  • (b) the circumstances in which each charge applies; and

  • (c) the formula or other method used to determine the amount of each charge.

Marginal note:Increase — Consumer Price Index

• 27 (1) The designated screening authority may increase a charge — annually or in respect of a period of more than one year but not more than five years after the day on which the charge took effect — in accordance with

  • (a) in the case of an annual increase, the percentage increase to the Consumer Price Index, rounded to the next 0.10%, for the previous year; or

  • (b) in the case of an increase in respect of a period, the aggregate of the annual percentage increases to the Consumer Price Index, rounded to the next 0.10%, for that period.

• Marginal note:Proposal submitted to Agency

  (2) The designated screening authority must submit a proposal to increase a charge in accordance with subsection (1) to the Agency for a determination of whether the proposed increase is in accordance with that subsection.

• Marginal note:Limit

  (3) In making a determination, the Agency may only consider whether the proposal is in accordance with subsection (1).

• Marginal note:Agency determination

  (4) The Agency must make a determination within 30 days after the day on which it receives the proposal and must notify the designated screening authority in writing of its determination.

• Marginal note:Publication

  (5) The designated screening authority must not publish a notice of the proposal under section 29 until after it is notified of the Agency’s determination. If the Agency does not make a determination within the 30-day period, the designated screening authority may publish the notice after the day on which that period expires.

• Marginal note:Definition of Consumer Price Index

  (6) In this section, Consumer Price Index means the annual average all-items Consumer Price Index for Canada (not seasonally adjusted) published by Statistics Canada.

Marginal note:Minister’s approval of charges

• 28 (1) The Minister may, on request of the designated screening authority, approve a proposal to establish or increase a charge if the Minister is of the opinion that

  • (a) implementing a direction issued under section 16 or complying with a new requirement in a security measure, emergency direction or interim order made under the Aeronautics Act has increased or will increase the designated screening authority’s costs related to security screening services made available or provided under section 18 at aerodromes designated by the regulations; and

  • (b) the designated screening authority observed the charging principles in its proposal to establish or increase the charge.

• Marginal note:Request before publication

  (2) The designated screening authority must make the request before it publishes a notice of the proposal under section 29.

• Marginal note:Minister’s decision

  (3) The Minister must make a decision within 30 days after the day on which he or she receives a request and must notify the designated screening authority in writing of his or her decision.

Marginal note:Notice of proposal

• 29 (1) The designated screening authority must publish a notice of any proposal to establish, revise or terminate a charge, including a proposal referred to in section 27 or 28. The designated screening authority must provide the Agency with a copy of the notice no later than the day on which it is published.

• Marginal note:Contents of notice

  (2) The notice must

  • (a) describe the proposal, including the methodology, the proposed amount of the charge and the circumstances in which the charge would apply;

  • (b) specify the date on which the charge or its termination would take effect;

  • (c) set out the designated screening authority’s reasons for establishing, revising or terminating the charge in relation to the charging principles;

  • (d) in the case of a proposal to increase a charge in accordance with section 27, indicate whether the Agency determined that the proposal is in accordance with subsection 27(1);

  • (e) in the case of a proposal referred to in section 28, indicate that the Minister approved the proposal; and

  • (f) in the case of a proposal in respect of which a person may file a notice of objection under subsection 31(1) or (2), indicate that a notice of objection may be filed under one of those subsections.

• Marginal note:Effective date

  (3) The date on which a charge or its termination would take effect must not be before

  • (a) in the case of a proposal in respect of which a person may file a notice of objection under subsection 31(1) or (2), the 121st day after the day on which the notice is published; and

  • (b) in the case of any other proposal, the 31st day after the day on which the notice is published.

• Marginal note:Duty to inform air carriers

  (4) The designated screening authority must, no later than the day on which a notice of a proposal is published, inform air carriers who are or will be required to collect charges under section 37.

Marginal note:Withdrawal of proposal

• 30 (1) The designated screening authority may withdraw a proposal to establish, revise or terminate a charge, other than a proposal referred to in any of sections 27, 28 and 60.

• Marginal note:Limitation

  (2) The designated screening authority may

  • (a) withdraw a proposal to establish or increase a charge no later than the earlier of

    • (i) the day on which the Agency makes a determination under section 32, and

    • (ii) the 30th day before the day on which the charge would take effect; and

  • (b) withdraw any other proposal no later than the 30th day before the day on which the charge or its termination would take effect.

• Marginal note:Notice of withdrawal

  (3) The designated screening authority must publish a notice of the withdrawal and provide the Agency with a copy. If the designated screening authority is withdrawing a proposal to revise or terminate a charge, the notice of withdrawal must include a statement that the amount of the charge that was in effect before the designated screening authority published a notice of the proposal under section 29 continues to be in effect and set out that amount.

• Marginal note:Effect of withdrawal

  (4) If the designated screening authority withdraws a proposal, the proposed charge or termination does not take effect.

Notice of Objection

Marginal note:Notice of objection — paragraph 24(1)(a)

• 31 (1) Any interested person may, within 30 days after the day on which the designated screening authority publishes a notice of a proposal to establish or increase a charge referred to in paragraph 24(1)(a), file a notice of objection with the Agency, in the form and manner determined by the Agency, on the grounds that the designated screening authority did not observe one or more of the charging principles.

• Marginal note:Notice of objection — paragraph 24(1)(b)

  (2) A person who will be required to pay a charge referred to in paragraph 24(1)(b) or a person in respect of whom the charge will be imposed may, within 30 days after the day on which the designated screening authority publishes a notice of a proposal to establish or increase a charge referred to in that paragraph, file a notice of objection with the Agency, in the form and manner determined by the Agency, on the grounds that the designated screening authority did not observe one or more of the charging principles.

• Marginal note:Exception

  (3) Subsections (1) and (2) do not apply in respect of a proposal to establish or increase a charge if the designated screening authority published a notice of the proposal in accordance with subsection 27(5) or the Minister approved the proposal under section 28 or 60.

• Marginal note:Contents of notice of objection

  (4) A notice of objection must include the reasons for which the person filing the notice considers that the designated screening authority did not observe the charging principles.

• Marginal note:Notification by Agency

  (5) As soon as feasible after beginning a review of a proposal, the Agency must notify the Minister and the designated screening authority that it is reviewing the proposal.

Marginal note:Determination by Agency

• 32 (1) If a notice of objection is filed with the Agency, the Agency must determine whether the designated screening authority observed all of the charging principles.

• Marginal note:Time limit

  (2) The Agency must make a determination as expeditiously as possible but no later than 90 days after the day on which the first notice of objection was filed.

• Marginal note:Proposal rejected

  (3) If the Agency determines that the designated screening authority did not observe the charging principles, the Agency must reject the proposal and the proposed charge does not take effect.

• Marginal note:Notice of rejection

  (4) As soon as feasible after it is informed that the Agency rejected a proposal, the designated screening authority must publish a notice indicating that the proposal has been rejected. If the proposal was to increase a charge, the notice must include a statement that the amount of the charge that was in effect before the designated screening authority published a notice of the proposal under section 29 continues to be in effect and set out that amount.

• Marginal note:Proposal approved

  (5) If the Agency determines that the designated screening authority observed the charging principles, the Agency must approve the proposal and the charge takes effect on the date specified in the notice published under section 29.

• Marginal note:Determination and reasons

  (6) The Agency must give its determination and the reasons for it in writing.

• Marginal note:Copy to Minister

  (7) The Agency must provide the Minister with a copy of its determination and the reasons for it immediately after the determination is made.

General Provisions

Marginal note:Confidential information

33 The Agency must take any measures necessary to maintain the confidentiality of any commercial, financial, scientific or technical information provided to the Agency in respect of a proceeding under this Act if the information has consistently been treated as confidential by any interested person or entity.

Marginal note:No mediation

34 Section 36.1 of the Canada Transportation Act does not apply to a proceeding before the Agency under this Act.

Marginal note:Determination final

35 A determination made by the Agency under this Act is final and sections 32, 40 and 41 of the Canada Transportation Act do not apply in respect of it.

Marginal note:No policy directions issued to Agency

36 Sections 24 and 43 of the Canada Transportation Act do not apply in respect of the powers, duties and functions of the Agency under this Act.

Collection and Remittance

Seizure and Detention of Aircraft

Enforcement

Marginal note:Court order — section 12

43 On application by a current or former member, director or officer of the designated screening authority or any other person who, in the discretion of the court, is a proper person to make an application, a superior court may, if it is satisfied that the designated screening authority has contravened any of subsections 12(1) to (3), make any order that it considers appropriate in the circumstances, including an order requiring the designated screening authority to amend its articles of incorporation or by-laws or an order appointing directors in place of any of the directors then in office.

Marginal note:Offence — direction

• The following provision is not in force.

  47 (1) If the designated screening authority contravenes a direction issued under subsection 16(1), it is guilty of an offence punishable on summary conviction and is liable to a fine of not more than $25,000 for each day or part of a day that the offence continues.

• Marginal note:Offence — subsection 29(1)

  (2) If the designated screening authority contravenes subsection 29(1), it is guilty of an offence punishable on summary conviction and is liable to a fine of not more than $25,000 for each day or part of a day that the offence continues.

Marginal note:Due diligence

48 A person is not to be found guilty of an offence under section 46 or 47 if they establish that they exercised due diligence to prevent the commission of the offence.

Marginal note:Imprisonment precluded

49 If a person is convicted of an offence under section 46 or 47, imprisonment is not to be imposed in default of payment of any fine imposed as punishment in relation to the offence.

Regulations

Marginal note:Governor in Council

50 The Governor in Council may make regulations

• (a) designating aerodromes for the purposes of this Act;

• (b) prescribing persons or categories of persons for the purposes of paragraph 24(2)(d) or subsection 24(3);

• (c) respecting the collection of charges under section 37 and the remittance of charges under section 38;

• (d) requiring the designated screening authority to provide the Minister with any information that the Minister may request; and

• (e) generally for carrying out the purposes and provisions of this Act.

Five-year Review

Marginal note:Review of Act

• 51 (1) A review of the provisions and operation of this Act must be completed by the Minister during the fifth year after the transfer date.

• Marginal note:Tabling of report

  (2) The Minister must cause a report of the results of the review to be laid before each House of Parliament on any of the first 15 days on which that House is sitting after the report is completed.

Transitional Provisions

Marginal note:Sale or disposition of assets and liabilities

52 The Canadian Air Transport Security Authority may, with the approval of the Governor in Council and on any terms and conditions that the Governor in Council considers appropriate,

• (a) sell or otherwise dispose of some or all of its assets and liabilities to the designated screening authority; and

• (b) do anything that is necessary for, or incidental to, a measure referred to in paragraph (a).

Marginal note:Directives

• 53 (1) The Governor in Council may, on the recommendation of the Minister and on any terms and conditions that the Governor in Council considers appropriate, issue a written directive to the Canadian Air Transport Security Authority to take any measure referred to in section 52.

• Marginal note:Time limit

  (2) The Governor in Council may issue a directive only before the transfer date.

• Marginal note:Directive binding

  (3) The Canadian Air Transport Security Authority and its directors, officers and employees must comply with a directive as soon as feasible. Compliance with a directive is deemed to be in the Canadian Air Transport Security Authority’s best interests.

• Marginal note:Notice of implementation

  (4) The Canadian Air Transport Security Authority must notify the Minister as soon as feasible after a directive has been implemented.

• Marginal note:Non-application of Statutory Instruments Act

  (5) The Statutory Instruments Act does not apply to a directive.

Marginal note:Proceeds of disposition

54 The Canadian Air Transport Security Authority must pay the proceeds from a sale or other disposition of assets or liabilities under section 52 to the Receiver General.

Marginal note:Financial Administration Act

55 Section 89 of the Financial Administration Act does not apply to any measure referred to in section 52.

Marginal note:Part X of Financial Administration Act

56 The Governor in Council may, by order, declare that any provision of Part X of the Financial Administration Act does not apply to or in respect of the Canadian Air Transport Security Authority.

Marginal note:Canadian Air Transport Security Authority Act

57 Beginning on the transfer date, sections 6 to 9, 27 to 30.1 and 34 of the Canadian Air Transport Security Authority Act are suspended.

Marginal note:Regulations and places designated

58 On the transfer date, regulations made under paragraph 34(a) of the Canadian Air Transport Security Authority Act are deemed to have been made under section 50 of this Act and any place designated by the Minister under subsection 6(1.1) of that Act is deemed to be designated under subsection 18(3) of this Act.

Marginal note:Transition period payments

• 59 (1) The Minister may enter into an agreement with the designated screening authority regarding transition period payments by Her Majesty in right of Canada to the designated screening authority after the transfer date.

• Marginal note:Appropriation

  (2) There is appropriated the sum of $872,000,000, or any greater amount that is authorized from time to time under an appropriation Act, to be paid out of the Consolidated Revenue Fund from time to time as required for the purpose of implementing an agreement referred to in subsection (1).

Marginal note:Minister’s approval of initial charges

• 60 (1) The designated screening authority may, before the first anniversary of the transfer date, submit a request to the Minister for approval of the initial charges that it proposes to establish for security screening services made available or provided under section 18 at aerodromes designated by the regulations.

• Marginal note:Time limit

  (2) The Minister must, within 60 days after the day on which he or she receives a request, decide whether the designated screening authority observed the charging principles.

• Marginal note:Decision

  (3) If the Minister decides that the designated screening authority observed the charging principles, the Minister must approve the proposal.

• Marginal note:Notice in writing

  (4) The Minister must notify the designated screening authority in writing of his or her decision.

• Marginal note:Duty to publish notice

  (5) The designated screening authority must publish, in accordance with section 29, a notice of a proposal that has been approved by the Minister and must indicate in the notice that the proposal has been approved.

Marginal note:Closing out of affairs

• 61 (1) Beginning on the transfer date, the Canadian Air Transport Security Authority is authorized to sell or otherwise dispose of all or substantially all of its assets and liabilities and do everything necessary for or incidental to closing out its affairs.

• Marginal note:Legal powers

  (2) For the purposes of this section, the Canadian Air Transport Security Authority has the capacity, rights, powers and privileges of a natural person.

• Marginal note:Minister’s power

  (3) Beginning on the transfer date, the Minister may require the Canadian Air Transport Security Authority to do anything that, in his or her opinion, is necessary to sell or otherwise dispose of all or substantially all of its assets and liabilities, satisfy its debts, manage its expenses or otherwise close out its affairs.

• Marginal note:Compliance

  (4) The Canadian Air Transport Security Authority must do what the Minister requires under subsection (3).

62 [Amendments]

Marginal note:Dissolution

63 The Canadian Air Transport Security Authority is dissolved on a day to be fixed by order of the Governor in Council.