Vol. 140, No. 26 — December 27, 2006

Registration
SOR/2006-347 December 14, 2006

CANADIAN ENVIRONMENTAL PROTECTION ACT, 1999

2-Butoxyethanol Regulations

P.C. 2006-1557 December 14, 2006

Whereas, pursuant to subsection 332(1) (see footnote a) of the Canadian Environmental Protection Act, 1999 (see footnote b), the Minister of the Environment published in the Canada Gazette, Part I, on July 9, 2005 a copy of the proposed 2-Butoxyethanol Regulations under the title Regulations Respecting 2-Butoxyethanol, substantially in the annexed form, and persons were given an opportunity to file comments with respect to the proposed Regulations or to file a notice of objection requesting that a board of review be established and stating the reasons for the objection;

Whereas, pursuant to subsection 93(3) of that Act, the National Advisory Committee has been given an opportunity to provide its advice under section 6 (see footnote c) of that Act;

And whereas, in the opinion of the Governor in Council, pursuant to subsection 93(4) of that Act, the proposed Regulations do not regulate an aspect of a substance that is regulated by or under any other Act of Parliament in a manner that provides, in the opinion of the Governor in Council, sufficient protection to the environment and human health;

Therefore, Her Excellency the Governor General in Council, pursuant to subsection 93(1) and section 319 of the Canadian Environmental Protection Act, 1999 (see footnote d), on the recommendation of the Minister of the Environment and the Minister of Health, hereby makes the annexed 2-Butoxyethanol Regulations.

2-BUTOXYETHANOL REGULATIONS

APPLICATION

1. These Regulations apply in respect of products set out in column 1 of Schedule 1 that contain 2-butoxyethanol, which has the molecular formula C₆H₁₄O₂, and that are for indoor use except if they are for use

(a) in a manufacturing or processing activity;

(b) in a commercial activity as paints or coatings, including automobile refinish coatings;

(c) as a solvent in a laboratory for analysis;

(d) in scientific research; or

(e) as a laboratory analytical standard.

PROHIBITIONS

2. (1) No person shall manufacture or import a product set out in column 1 of Schedule 1 if its concentration of 2-butoxyethanol exceeds the limit set out in column 2 for that product unless

(a) dilution of the product is required, in accordance with the manufacturer's written instructions, to a concentration equal to or less than the limit set out in column 2 for that product before it is used and that product is either labelled with or accompanied by those instructions in both official languages; or

(b) the person has been issued a permit under section 5 and, in the case of a product that is to be diluted before it is used, that product is either labelled with or accompanied by the manufacturer's written dilution instructions in both official languages.

(2) The prohibition in subsection (1) does not apply, however, to the manufacturing or importing of a product for export only.

3. No person shall sell or offer for sale a product set out in column 1 of Schedule 1 if its concentration of 2-butoxyethanol exceeds the limit set out in column 2 for that product unless

(a) dilution of the product is required, in accordance with the manufacturer's written instructions, to a concentration equal to or less than the limit set out in column 2 for that product before it is used and that product is either labelled with or accompanied by those instructions in both official languages; or

(b) that product was manufactured or imported under a permit issued under section 5, the sale or offer to sell occurs no later than one year after the expiry date of the permit and, in the case of a product that is to be diluted before it is used, that product is either labelled with or accompanied by the manufacturer's written dilution instructions in both official languages.

PERMITS

APPLICATION

4. (1) Any person that is importing or manufacturing a product set out in column 1 of Schedule 1 whose concentration of 2-butoxyethanol exceeds the limit set out in column 2 for that product other than a product referred to in paragraph 2(1)(a) shall hold a permit to continue that activity.

(2) An application for a permit shall be submitted to the Minister and contain the information specified in Schedule 2.

(3) The application shall be accompanied by a certification, dated and signed by the applicant, or by their authorized representative, stating that the information contained in the application is accurate and complete.

(4) The application and certification may be submitted either in writing or in an electronic format that is compatible with the one that is used by the Minister and the documents shall bear the written or electronic signature, as the case may be, of the applicant or their authorized representative.

CONDITIONS OF ISSUANCE

5. (1) Subject to subsection (2), the Minister shall issue the permit if the following conditions are met:

(a) it is not technically or economically feasible to reduce the concentration of 2-butoxyethanol in the product to the limit set out in column 2 of Schedule 1 for that product;

(b) the applicant has taken all necessary measures to minimize or eliminate any harmful effect of 2-butoxyethanol on human health;

(c) a plan has been prepared by the applicant identifying the measures that they intend to take so that the concentration of 2-butoxyethanol in the product to be manufactured or imported will be within the limit prescribed by these Regulations; and

(d) the period within which the plan is to be fully implemented does not exceed four years from the day on which a permit is first issued to the applicant.

(2) The Minister shall refuse to issue a permit if the Minister has reasonable grounds to believe that the applicant has provided false or misleading information in support of their application.

(3) A permit expires 24 months after the day on which it is issued unless, before its expiry date, the applicant submits a new application in accordance with section 4. The validity of the initial permit may only be extended once for an additional 24 months for the same use of 2-butoxyethanol.

REVOCATION

6. (1) The Minister shall revoke a permit if the conditions set out in paragraphs 5(1)(a) to (d) are no longer met or if the Minister has reasonable grounds to believe that the permit holder has provided false or misleading information to the Minister.

(2) The Minister shall not revoke a permit unless the Minister has provided the permit holder with

(a) written reasons for the revocation; and

(b) an opportunity to be heard, by written representation, in respect of the revocation.

ANALYSIS BY ACCREDITED LABORATORY

7. The concentration of 2-butoxyethanol under these Regulations shall be determined by a laboratory that is accredited under the International Organization for Standardization standard ISO/IEC 17025: 2005, entitled General requirements for the competence of testing and calibration laboratories, as amended from time to time, and whose accreditation includes the analysis of 2-butoxyethanol within its scope of testing.

RECORD KEEPING

8. (1) Every person that submits the information set out in Schedule 2 shall keep a copy of that information, the certification and any documents supporting the information for a period of at least five years, beginning on the date of the submission of the information.

(2) Every person that manufactures or imports a product set out in column 1 of Schedule 1 containing 2-butoxyethanol shall keep a record of the results of any analysis conducted to determine the concentration of 2-butoxyethanol in the product — either as diluted in accordance with the manufacturer's written instructions, in the case of a product that is to be diluted, or as it is manufactured —, the name of the laboratory that performed the analysis and any supporting documents related to the analysis for a period of at least five years, beginning on the date of the analysis.

(3) The information, certification, results of analysis and supporting documents that are required to be kept by the person shall be kept at their principal place of business in Canada or at any other place in Canada where the information, certification, results and supporting documents can be inspected. If those records are kept at any place other than the person's principal place of business, the person shall provide the Minister with the civic address of the place where they are kept.

(4) The person shall keep the required information, certification, test results and supporting documents in writing or in an electronic format that is compatible with the one that is used by the Minister.

COMING INTO FORCE

9. (1) Subject to subsection (2), these Regulations come into force one year after the day on which they are registered.

(2) Section 3 comes into force two years after the day on which these Regulations are registered.

SCHEDULE 1

(Section 1, subsection 2(1), section 3, subsection 4(1),
paragraph 5(1)(a), subsection 8(2), and Schedule 2)

 

Item	Column 1 Product	Column 2 Concentration Limit (%) (w/w)
1.	Automobile Cleaner1	10.0
2.	Rug or Carpet Cleaner	10.0
3.	Floor or Baseboard Stripper	2.0
4.	Paint Stripper or Thinner	0.5
5.	Laundry Stain Remover	22.0
6.	Any Other Aerosol2 Cleaner3	5.0
7.	Any Other Non-aerosol Cleaner3	6.0
8.	Aerosol2 Paint or Coating	0.1
9.	Non-aerosol Paint or Coating	0.5

¹ Does not include automobile degreasers.

² Does not include pump sprays.

³ A product to be used to degrease and clean glass, floors and other surfaces, including bathroom and kitchen surfaces, but does not include automobile degreasers.

SCHEDULE 2

(Subsections 4(2) and 8(1))

INFORMATION TO BE CONTAINED IN AN APPLICATION FOR A PERMIT

1. Information respecting the applicant:

(a) their name, civic and postal addresses, e-mail address, if any, telephone number and fax number, if any; and

(b) the name, title, civic and postal addresses, e-mail address, if any, telephone number and fax number, if any, of their authorized representative, if any.

2. Information respecting the product:

(a) its name;

(b) its concentration of 2-butoxyethanol;

(c) the estimated quantity to be manufactured, sold, offered for sale or imported in a calendar year and the unit of measurement;

(d) the identification of each proposed use for the product; and

(e) an indication as to whether a permit has been issued under section 5 of these Regulations for each proposed use for the product.

3. Evidence that it is not technically or economically feasible to reduce the concentration of 2-butoxyethanol in the product to the limit set out in column 2 of Schedule 1 for that product.

4. Identification of the measures that have been taken to minimize or eliminate any harmful effect of 2-butoxyethanol on human health.

5. A description of the plan prepared respecting 2-butoxyethanol identifying the measures to be taken so that the concentration of 2-butoxyethanol in the product to be manufactured or imported will be within the limit prescribed by these Regulations.

6. Identification of the period within which the plan is to be fully implemented.

7. The civic and postal addresses of the location where records, certification and supporting documents are kept.

8. An applicant that submits a request, in accordance with section 313 of the Canadian Environmental Protection Act, 1999, that information contained in the application be treated as confidential must include with that request the identification of the following:

(a) any information that constitutes a trade secret;

(b) any information the disclosure of which would likely cause material financial loss to, or prejudice the competitive position of, the applicant;

(c) any information the disclosure of which would likely interfere with contractual or other negotiations being conducted by the applicant; and

(d) any financial, commercial, scientific or technical information that is confidential and is treated consistently in a confidential manner by the applicant.

REGULATORY IMPACT
ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Description

Purpose

The purpose of the 2-Butoxyethanol Regulations (hereinafter referred to as the Regulations) is to protect the health of Canadians by setting limits for the concentration of 2-butoxyethanol (2-BE) in products designed for indoor use. This will reduce human exposure to 2-BE present in cleaning, painting and coating products to below potentially harmful levels. The concentration limits will apply to products that are manufactured, imported, offered for sale, or sold in Canada.

The concentration limits will come into force one year after the day on which the Regulations are registered for the import and manufacture of products, and two years after the day on which the Regulations are registered for the sale or offer for sale of products.

Background

On August 9, 2003, the Ministers of the Environment and of Health published their final decision on the assessment of 2-BE in the Canada Gazette,Part I, and indicated their intent to recommend that 2-BE be added to the List of Toxic Substances in Schedule 1 under the Canadian Environmental Protection Act, 1999 (CEPA 1999). The final version of the assessment report concluded that 2-BE constitutes a danger in Canada to human life or health, under paragraph 64(c) of CEPA 1999. However, 2-BE was not considered to have an immediate or long-term harmful effect on the environment or its biological diversity; neither was it found to constitute a danger to the environment on which life depends. On March 9, 2005, an Order adding 2-BE to the List of Toxic Substances in Schedule 1 of CEPA 1999 was published in the Canada Gazette, Part II.

Based on investigations conducted on experimental animals, the risk assessment report concluded that chronic exposure to 2-BE could cause alterations in blood that are associated with hemolytic anemia. The assessment report determined a Tolerable Concentration (TC) to reduce this health risk. A TC is the level of intake to which it is believed a person may be exposed daily over a lifetime without deleterious effect. The TC for 2-BE-induced hematological effects in humans should not exceed 11 milligrams/ cubic metre (2.3 parts per million).

2-BE is used in a wide range of applications, including industrial, institutional and consumer products. Emissions of 2-BE from industrial sources do not result in atmospheric concentrations that may present a health risk to the Canadian population. Indeed, the assessment report indicated that levels of 2-BE in ambient air in Canada are lower than the TC.

Many consumer and institutional products designed for indoor use, including cleaners, paints and coatings, contain 2-BE. These products are routinely used by consumers and by institutions, such as schools and hospitals, where the general public is present. Consumer exposure modelling indicated that exposure resulting from the use of products containing 2-BE in indoor settings could potentially exceed the TC. Therefore, addressing the 2-BE content of indoor products used by consumers and institutions is essential for reducing the human health risk identified by the assessment report.

Other products such as pesticides, heath care products and cosmetics have also been found to contain 2-BE. Control measures for 2-BE in health care products and cosmetics have been developed and implemented by Health Canada under the Food and Drugs Act. Pesticides containing 2-BE will be managed through actions taken under the authority of the Pest Control Products Act or through other measures. Hence, these products are not addressed through these Regulations.

2-BE belongs to the category of glycol ethers, and there are substitutes commercially available. There is no manufacturing of 2-BE in Canada. 2-BE is imported as a commodity chemical and as a component of formulated products. The quantity of 2-BE used in Canada grew during the 1990s and peaked in the year 2000, at almost 8 kilotonnes (kt). Starting in 2001, the quantities of 2-BE used in Canada have been steadily declining and fell to about 4.6 kt in 2004, which includes 1 kt used in consumer products and 3.6 kt used in industrial applications. This represents a decline of 42 percent between year 2000 and year 2004 and an average annual rate of decline of 12.6 percent. The declining trend in the use of 2-BE in Canada is largely due to the replacement of 2-BE with alternatives.

It was estimated that a total of 444 cleaning, painting and coating products for indoor use, which are currently commercialized, contain 2-BE. Several of these products already show 2-BE concentrations below the limits set out by these Regulations and will therefore not be affected. Other products, including 104 paints and coatings and 59 cleaning products, contain 2-BE in concentrations that exceed the limits. It was estimated that a total of 455 tonnes of 2-BE was used in products exceeding the concentration limits of the Regulations in 2004.

Regulations

The Regulations set limits in the concentration of 2-BE in products designed for indoor use. These concentration limits will ensure that users and bystanders are not exposed to levels of 2-BE above the TC determined by the assessment report. The concentration limits are based on the TC and on exposure modelling studies that assessed the exposure of users and bystanders resulting from the application of products containing 2-BE. Table 1 shows the concentration limits per product category.

Table 1: 2-BE Concentration Limits for Indoor-use Products

Products	Concentration Limit (%) (w/w)
Automobile Cleaner*	10.0
Rug or Carpet Cleaner	10.0
Floor or Baseboard Stripper	2.0
Paint Stripper or Thinner	0.5
Laundry Stain Remover	22.0
Any Other Aerosol** Cleaner***	5.0
Any Other Non-aerosol Cleaner***	6.0
Aerosol** Paint or Coating	0.1
Non-aerosol Paint or Coating	0.5

^* Does not include automobile degreasers.

^** Does not include pump sprays.

^*** A product to be used to degrease and clean glass, floors and other surfaces, including bathroom and kitchen surfaces, but does not include automobile degreasers.

These concentration limits do not apply to products designed for use in a manufacturing or processing activity; for use in a commercial activity as paints or coatings, including automobile refinish coatings; for use as a solvent in a laboratory for analysis; for use in scientific research; or for use as a laboratory analytical standard. The concentration limits for 2-BE are intended to apply to the final products, ready to use, and not to the concentrated products. The manufacturer has to provide written instructions in both official languages for the dilution of the product, either on the label or in the instructions accompanying the product.

An Environmental Performance Agreement (EPA) was developed, as an alternative measure, to control indoor commercial paint and coatings containing concentrations of 2-BE above the limits established in the Regulations. The purpose of the Agreement is to provide assurance that all paint and coating companies will take specific actions to ensure that any commercial paint and coatings for indoor use containing 2-BE with a concentration exceeding the limits set out in Schedule 1 of the Regulations will only be sold to industrial and commercial applicators and not to the general public. Thus, an exemption was granted in the Regulations for commercial paints and coatings.

The EPA has been signed by all suppliers of 2-BE containing commercial paint and coatings in the fall of 2006, and will be in effect for five years from the date of signing by the Minister of the Environment. It includes the option for renewing the Agreement, as well as a verification program to be conducted annually by a third party.

Consumer exposure resulting from the use of 2-BE containing laundry stain removers was found to be different than that resulting from cleaners. Hence, a separate category for laundry stain removers has been included in Schedule 1. This new category was added after the Government of Canada learned of at least one such product for consumer use containing 2-BE. A model of consumer exposure was subsequently undertaken to determine its 2-BE limit.

For a person to continue importing or manufacturing a product set out in Schedule 1, in which the concentration of 2-BE exceeds the limits set out in the same Schedule, beyond the effective date of the regulatory requirements, that person is obliged to obtain a permit from the Minister of Environment in order to continue that activity. The Regulations set strict conditions of eligibility for such a permit. For example, the applicant must demonstrate that it is not technically or economically feasible to reduce the concentration of 2-BE in the product to the limit set out in Schedule 1; that the applicant has taken all necessary measures to minimize or eliminate any harmful effect of 2-BE on human health; that a plan has been prepared by the applicant identifying the measures to be taken by them so that the concentration of 2-BE in the product will be within the limit prescribed by these Regulations; and the period within which the plan is to be fully implemented does not exceed four years from the date on which a permit is first issued to the applicant. Permits may be issued for 24 months and can be renewed only once. The requirements for applying for a permit renewal are the same as those for applying for the original permit. After a permit expires, the applicant will have a one-year grace period for selling or offering for sale products for which they had requested the permit.

In the permit-reporting section, the requirement concerning to whom the manufacturer or importer intends to sell was removed from the Regulations. This modification addressed retailers' concerns, as it would have been extremely difficult for them to fulfill the requirement.

The Regulations were modified to allow the flexibility of keeping records in electronic media. This provides stakeholders with flexibility concerning the keeping of records.

The Government of Canada has determined that the reporting requirement would not assist in meeting the environment objective and consequently has been removed from the Regulations.

Existing Environmental Controls on 2-BE

There are currently a series of measures aimed at reducing emissions of and human exposure to 2-BE. These include the Consumer Chemicals and Containers Regulations, 2001 (under the Hazardous Products Act), the Environmental Choice Labelling Program, and the Guidelines for Volatile Organic Compounds in Consumer Products.

The Consumer Chemicals and Containers Regulations, 2001 (under the Hazardous Products Act)classify consumer products containing 2-BE based on their human health hazard. They also require precautionary labelling, in order to inform consumers of the hazards posed by particularly harmful products during normal use. In addition, a prohibition related to the toxicological properties of products eliminates consumer exposure to very harmful chemicals. The classification is completed on a whole product basis. Thus 2-BE content alone would not necessarily be indicative of the hazard rating for a particular product. This classification does not consider chronic toxic effects of products, only acute ones.

The Environmental Choice Labelling Program encompasses cleaning products, biologically based cleaning and degreasing compounds, and personal care products. Firms commercializing these products can use the EcoLogo only if the product does not contain 2-BE.

The federal Guidelines for Volatile Organic Compounds in Consumer Products recommend levels for total volatile organic compounds (VOCs), including 2-BE, in product categories. Further, the Minister of the Environment and the Minister of Health intend to develop and implement, between 2004 and 2010, a series of measures to reduce emissions of VOCs from consumer and commercial products in accordance with the Federal Agenda for Reduction of Emissions of VOCs from Consumer and Commercial Products. 2-BE is a VOC, and any action taken for VOCs in consumer products may also indirectly reduce exposure to 2-BE.

Although these measures aim at reducing human exposure to 2-BE, they are unlikely to achieve the objective of reducing exposure below the TC. For example, the recommendation for total VOC contentset out in the Guidelines for Volatile Organic Compounds in Consumer Products could be achieved without reducing the 2-BE content. In addition, these Guidelines and the Environmental Choice Labelling Program are voluntary in nature. Finally, the Consumer Chemicals and Containers Regulations, 2001 address acute toxicity rather than chronic toxicity. Therefore, all existing controls on 2-BE were deemed inappropriate for dealing with the chronic human health risk evaluated by the assessment report.

Alternatives

Status Quo

Consumer exposure modelling indicated that under current use patterns people might be exposed to unsafe levels of 2-BE. It was therefore concluded that the status quo could not be allowed to persist, and that some form of control measure to reduce the exposure of consumers and bystanders to 2-BE would need to be undertaken.

Economic Instruments

Economic or market-based instruments work by providing incentives and/or disincentives aimed at changing consumer and/or producer behavior. When properly used, market-based instruments promote cost-effective ways of dealing with environmental issues. In addition, they provide long-term incentives for pollution reduction and technological innovation. The analysis considered permit trading programs and environmental charges.

Permit trading programs could guarantee a reduction in the overall use of 2-BE in indoor-use products. However, the health risk posed by different products is varied, and emission trading could not discriminate among different products. Therefore, emission trading could not ensure that reductions would occur in those products that present the highest risk.

Environmental charges could be levied on products containing concentrations of 2-BE above the thresholds. However, under section 328 of CEPA 1999, charges may not exceed the cost to Her Majesty in right of Canada of providing the service. It may be difficult to create the appropriate level of incentive for firms to lower the concentration of 2-BE in their products. Therefore, the health risk of concern could persist despite the environmental charges.

Voluntary Measures

The main concern with voluntary tools is their effectiveness in achieving the risk management objective. Voluntary measures would not be mandatory; therefore, they may not ensure an effective reduction in health risks and/or a fair and level playing field. This was found to be a concern for most 2-BE-containing indoor-use products, but not for commercial paint and coatings.

Commercial paints and coatings are meant to be sold exclusively to commercial and industrial applicators. If used properly by commercial and industrial applicators, these products do not present a health risk to the general public. An EPA which ensures that any commercial paint and coatings for indoor use that contain 2-BE with a concentration exceeding the limits set out in Schedule 1 of the Regulations, will only be sold to industrial and commercial applicators and not to the general public. Such an agreement can provide companies with a degree of flexibility in meeting human health objectives associated with 2-BE. For this reason, an EPA was selected as a complementary tool to the Regulations.

Pollution Prevention Plans

Pollution prevention (P2) plans were considered to be potentially effective instruments for reducing human exposure below the TC levels. However, some important concerns remained, as they could not ensure a level playing field, since the flexibility of the P2 planning requirements in CEPA 1999 allow a regulatee to implement measures for only as many of the factors to be considered for a P2 plan that the person decides are relevant to their operation.

2-Butoxyethanol Regulations

The Regulations were considered to be the most practical and effective way of addressing the human health concerns associated with 2-BE. By setting mandatory concentration limits for the 2-BE content of indoor-use products, regulations will have the capacity to effectively reduce the health risk. In addition, the Regulations provide a level playing field for both manufacturers and importers.

Benefits and Costs

Introduction

An analysis of benefits and costs was conducted to assess the economic impacts of the Regulations. Incremental benefits and costs were evaluated qualitatively and quantitatively, based on a comparison of baseline and regulated scenarios. The following sections present the assumptions behind the baseline and regulated scenarios, the results of the analysis and the conclusion derived from it.

Baseline Scenario

The baseline scenario assumed that the observed trend in the decline of 2-BE use would continue for some time, and that the quantity of 2-BE imported and used would further decline until about 2010. This is based on the assumption that manufacturers would continue to use 2-BE in proven products and would reduce its concentrations slowly, but would increasingly use alternatives in newer products. The total use of 2-BE in indoor-use products is projected to fall to about 497 tonnes by year 2010, including 191.7 tonnes used in products affected by the Regulations. From 2010 onward, the baseline scenario assumed that uses of 2-BE would remain constant at 497 tonnes.

Regulated Scenario

Most alternatives to 2-BE (i.e. other glycol ethers) are already being produced in volumes sufficient for use by manufacturers of products to replace those that currently contain 2-BE, and this supply is expected to meet the increased demand caused by the Regulations. In addition to being available, several replacements for 2-BE are cost-effective substitutes in many applications. Therefore, industry is expected to replace 2-BE in a large number of products and reduce 2-BE to allowable concentration limits in others. However, replacing 2-BE is expected to be difficult in some applications, where technical properties of 2-BE are unique or difficult to replicate in a cost-effective manner. In such instances, the permits system set out by the Regulations will provide industry with some flexibility and time to find substitutes.

Under the assumptions of the regulated scenario, the use of 2-BE in indoor-use products directly affected by the Regulations is predicted to fall from about 191.7 tonnes under baseline to 68.4 tonnes by the year 2010. In year 2017, the use of 2-BE in the affected products is expected to fall from 180.5 tonnes under baseline to 21.6 tonnes under the regulated scenario.

2-BE substitutes considered in this analysis also belong to the category of glycol ethers and pose lower health risks than 2-BE. In consequence, they are acceptable alternatives from a human health perspective.

Cost-Benefit Analysis Framework

The key categories of costs and benefits included in the analysis are the following:

•  Industry compliance costs:

• Input substitution costs
• Product reformulation costs
• Permits and other administrative costs
• Transitional costs

•  Government costs

• Enforcement costs
• Compliance promotion costs
• Permit system administration costs
• Laboratory test development costs

•  Human health benefits

All costs were estimated in monetary terms to the extent possible. Whenever this was not possible, due to lack of appropriate data or difficulties in valuing certain components or data inputs, the cost item was evaluated in qualitative terms. Monetary estimates were made in constant prices (or in real terms) — in this case, in 2004 Canadian dollars (C$ 2004). When the source data were affected by inflation, the data were converted into C$ 2004 using Statistics Canada industrial price index for chemical products. Human health benefits could not be quantified due to lack of epidemiological data. Instead, a qualitative assessment of benefits was done.

The time horizon used for evaluating economic impacts was 20 years. In addition, sensitivity testing was conducted using a 25-year time horizon. The first year of the analysis was 2007, when the Regulations are expected to come into force.

Calculation of the stream of benefits and costs was done in terms of the present value (PV). PV calculation involves discounting the stream of costs and benefits with an annual real discount rate. This study employed the discount rate of 5 percent and then conducted a sensitivity analysis using 3 percent and 7 percent discount rates to test the volatility of cost estimates to this specific parameter.

Uncertainty and risk related to the magnitude and timing of costs and benefits was dealt with through sensitivity analysis and risk analysis. The risk analysis used probability distributions constructed from median values and lower and upper ranges for each variable. Probability distributions were assigned for model variables, parameters and final results.

Costs

Costs to the Private Sector and to Society at Large

Costs to the private sector include input substitution, product reformulation, administrative and transitional costs. Initially, these compliance costs will be incurred by industry. Depending on market characteristics, some or all of these costs might then be passed on to consumers through higher prices. This analysis generated estimates of industry compliance costs, but did not assess the extent to which they would or would not be transferred to consumers.

Replacing 2-BE in product formulations is expected to create input substitution costs wherever substitutes are more expensive than 2-BE. Cost savings might occur if substitutes are more cost-effective than 2-BE. Input substitution costs were estimated using market prices and technical performance ratios. In addition, reformulation costs will be incurred in developing new formulations that contain 2-BE levels below the concentrations limits. These costs were estimated based on the research and development efforts required to substitute 2-BE with other glycol ethers.

Under certain circumstances, the Regulations allow firms to apply for permits to continue using 2-BE in excess of the limits prescribed by the Regulations. As a result, firms will incur administrative costs associated with permit applications. Firms might also incur other administrative costs, such as new products certification and stock management.

Transitional costs were also included in the analysis. These costs encompass marketing efforts associated with new or reformulated products, as well as potential incremental costs of producing separately for domestic and export markets. Manufacturers are expected to incur the latter costs in cases where the increased cost of reformulated products negatively affects their competitiveness in international markets, thus motivating them to keep separate production lines for domestic and export sales.

A summary of cost estimates is provided in Table 2. Reformulation and administrative costs are the most significant, representing almost two thirds of total private sector costs. The risk analysis carried out to reflect uncertainty associated with model variables and parameters indicated that total costs to the private sector will fall between C$4.17 and C$10.83 million (C$ 2004) with an 80 percent probability. Sources of uncertainty included the large variance in prices of 2-BE substitutes and data-related uncertainty.

Table 2: Estimates of Private Sector Costs, in millions C$ 2004, Present Value

CATEGORY OF COSTS	Present Value (in Million for C$ 2004)
Total Costs to the Private Sector	$7.09
Incremental Input Costs	$1.19
Reformulation Costs	$3.16
Administrative Costs	$2.19
Transitional Costs	$0.55

Costs to the Government

The federal government is expected to incur costs in implementing the Regulations. Government costs include compliance promotion, laboratory test development, permits system administration, and enforcement. Government cost estimates are presented in Table 3.

Table 3: Summary of Government Cost Estimates, in millions C$ 2004, Present Value

CATEGORY OF COSTS	Present Value (in Million of C$ 2004)
Total Costs to the Government	$9.92
Compliance promotion	$0.06
Laboratory test Development	$0.19
Permits system administration	$0.04
Enforcement	$9.63

Enforcement costs are expected to be the most significant Government investment in implementing the Regulations. The number of retailers that sell cleaning, painting and coating products containing 2-BE is unknown. Therefore, inspection and other enforcement activities will focus on manufacturers and importers. Enforcement cost estimates assumed that 25 percent of the manufacturers and importers of cleaning, painting and coating products will be inspected over a period of 10 years. It was also assumed that each manufacturer and importer has four product brands subject to the Regulations.

The focus of enforcement efforts will be on-site inspections, with sampling of regulated products and review of documents related to the ingredients/formulation of those products. Inspections will centre on the categories of cleaning, painting and coating products for which the estimated rate of non-compliance is highest. In addition, there will be on-site inspection of documents that regulatees are required to retain at their principal place of business in Canada.

Compliance promotion activities are intended to encourage the regulated community to achieve compliance. Compliance promotion activities during the first year could include mailing out copies of the final Regulations, answering inquiries, developing and distributing promotional materials (e.g. a fact sheet, website material) and workshops/information sessions to explain the Regulations. In year two, compliance promotion activities will be limited to sending a reminder prior to the Regulation coming into force, responding to and tracking inquiries, and contributing to the compliance promotion database. Year three compliance promotion activities will be at a maintenance level and will be limited to responding to and tracking inquiries and contributing to the compliance promotion database. A higher level of effort for compliance promotion may be required if, subsequent to enforcement activities, compliance with the Regulations is found to be low.

Total Costs

The total costs of the Regulations are summarized in Table 4. The PV of total costs was estimated at C$17.01 million (C$ 2004). Sensitivity analysis was conducted to test the volatility of cost estimates to the discount rate and the time horizon. This analysis showed that using a discount rate of 3 percent would increase total costs by 16.2 percent, and using a discount rate of 7 percent would reduce total costs by 12.9 percent. Extending the time horizon to 25 years would increase total costs by 2.9 percent. In addition, the risk analysis indicated that total costs to Canadian society are likely to fall between C$14.07 and $20.73 million (C$ 2004), with an 80 percent probability.

Table 4: Total Costs of the Regulations, in millions of C$ 2004, Present Value

CATEGORY OF COSTS	Present Value (in Millions of C$ 2004)
Total Costs	$17.01
Government Costs	$9.92
Private Sector Costs	$7.09

Distribution of Private Sector Costs

The distributional analysis was conducted using data on the number of affected products by sector, the distribution of 2-BE imports, and the distribution of industrial establishments across Canada.

This analysis showed that costs will be unevenly distributed among industry sectors. In particular, the paints and coatings sector is expected to be the most affected, mainly because the concentration limits are the most stringent and they affect a relatively large number of product brands. Within the soap and cleaning compounds sector, the cleaners segment will have the biggest impact, as a result of having a large number of brands affected. The results of the distributional analysis by sectors are summarized in Table 5.

Table 5: Distribution of Total Costs by Sector, in millions of C$ 2004,Present Value

Sectors	Present Value (in Millions of C$ 2004)
Total Costs to Industry	$7.09
Soap and Cleaning Compounds Sector
Cleaners	$2.79
Automobile cleaners	$0.12
Rug and carpet cleaners	$0.34
Paints and Coatings Sector
Floor, baseboard, paint strippers	$1.39
Paints and coatings	$2.45

The geographic distribution of costs is summarized in Tables 6 and 7. Ontario and Quebec are the provinces that are expected to experience the largest share of industry costs. This is a direct result of both provinces concentrating the majority of the industrial sectors affected by the Regulations. An analysis of costs per capita showed that Ontario and Quebec might also experience the highest costs per capita, together with British Columbia. This applies particularly to the paints and coatings sector, where costs per capita were estimated to be almost double in Ontario compared with the rest of Canada (excepting Quebec and British Columbia).

Table 6: Geographic Distribution of Total Industry Costs of the Regulations (in millions of $C 2004)

GEOGRAPHIC REGION	SOAP AND CLEANING COMPOUND INDUSTRY		PAINTS AND COATINGS INDUSTRY		TOTAL
	SHARE	COST (in Million C$ 2004)	SHARE	COST (in Million C$ 2004)	SHARE	TOTAL COST (in Million C$ 2004)
Ontario	41.2%	$1.34	48.7%	$1.87	46.7%	$3.31
Quebec	28.9%	$0.94	21.0%	$0.81	23.0%	$1.63
British Columbia	12.7%	$0.41	13.6%	$0.52	13.4%	$0.95
Rest of Canada	17.2%	$0.56	16.7%	$0.64	16.9%	$1.20
Total Industry Cost	$3.25		3.84		$7.09

Table 7: Geographic Distribution of Industry Costs per Capita of the Regulations, in $C 2004

GEOGRAPHIC REGION	POPULATION, in MILLIONS	SOAP AND CLEANING COMPOUNDS INDUSTRY COST PER CAPITA in C$ 2004	PAINTS AND COATINGS INDUSTRY COST PER CAPITA, in C$ 2004
Ontario	12.39	$0.11	$0.15
Quebec	7.54	$0.12	$0.11
British Columbia	4.20	$0.10	$0.12
Rest of Canada	7.81	$0.07	$0.08
All of Canada	31.95	$0.10	$0.12

The distributional analysis also evaluated the impacts on small- and medium-sized enterprises (SMEs). There is some evidence which indicates that smaller establishments might incur a relatively larger cost than bigger establishments. For example, there are indications that multinational firms have already moved away from 2-BE and that most 2-BE uses are concentrated in SMEs. Moreover, smaller firms are expected to benefit less from economies of scale, compared to those derived by larger firms with their capacity to absorb fixed costs and their access to input price discounts.

Estimates of fixed costs per product brand were used to assess the impact on SMEs. To the extent that fixed costs do not change much with firm size, smaller firms are expected to be more affected than larger ones. The analysis found that fixed costs amount, on average, to $C40,000 in PV. These costs are in the range of the annual salary for one employee in the affected sectors, which is not expected to be significant for most SMEs. However, because some of these costs will be incurred in the first years after the Regulations come into force, they might represent a financial burden to some SMEs.

Benefits

Human Health Benefits

The Regulations are expected to reduce the health risk associated with hemolytic anemia, by bringing human exposure below the TC determined by the assessment report. The links between reduced human exposure and reduced health risks could not be quantified, because of the lack of epidemiological data. Therefore, the human health benefits were qualitatively assessed. To this end, estimates of the reduction in the number of people exposed to 2-BE in indoor-use products were obtained, to provide an indicator of the order of magnitude of the benefits associated with the Regulations.

Considering current market trends that show a tendency toward the declining use of 2-BE, the Regulations are expected to benefit Canadians by accelerating this trend and by ensuring that human exposure does not rise above TC levels.

Reduced human exposure resulting from the Regulations is particularly clear in the use of 2-BE containing paints and coatings, and ancillary products such as paint thinners. The concentration limits set out are very low, and will result in many 2-BE containing paint and coating products for indoor use being removed from the consumer market. Similarly, the reductions in 2-BE concentrations in cleaning products will result in reduced human exposure to 2-BE.

After the Regulations come into force, it is estimated that about 600,000 people will have access to cleaning products that either no longer contain 2-BE or contain levels of 2-BE low enough to ensure that health risks associated with hemolytic anemia will be minimized. In addition, 100,000 users of paints and coatings will have access to products with very low levels of 2-BE or with no 2-BE at all. The estimates of cleaning product users and paints and coatings users cannot be added up without running the risk of duplication, as the same people who use cleaning products may also use paints and coatings.

Reducing the human health risk associated with hemolytic anemia may alleviate the health care system and those who care for potentially affected individuals (i.e. family and friends). In addition, a better health is commonly linked to improved well-being.

Conclusion

Because benefits were not amenable to monetization, a monetary estimate of net benefits of the Regulations could not be derived. Instead, the analysis focuses on a qualitative assessment of the trade-off between costs and benefits.

The costs of the Regulations were estimated to amount to C$17.01 million (C$ 2004). The risk analysis indicated that total costs to Canadian society are likely to fall between C$14.07 and $20.73 million (C$ 2004), with an 80 percent probability. The federal government will incur an estimated C$9.92 million (C$ 2004) in implementing the Regulations. In addition, industry is expected to bear incremental costs estimated at C$7.09 million (C$ 2004), at least in the beginning. The extent to which industry will be able to pass on these costs to consumers through higher prices will determine the end recipient of the incremental costs. From a distributional standpoint, the provinces of Ontario and Quebec will be the most affected, in absolute terms, given the larger size of the affected sectors in these provinces. In per capita terms, Ontario, Quebec and British Columbia will bear the highest costs. Also, from a distributional perspective, the SMEs will suffer a disproportionate share of the costs in comparison to their size.

The benefits of the Regulations will accrue to Canadians all across the country. Cleaning, painting and coating products that are subject to the Regulations are used by consumers and institutions in all provinces and territories in Canada. By reducing the human exposure of users and bystanders, the Regulations will result in a reduction in the health risk associated with hemolytic anemia. An estimated 100,000 users of paints and coatings and 600,000 users of cleaning products will benefit directly from the Regulations.

Competitiveness

The Regulations may have competitiveness impacts in some sectors of the Canadian economy. In particular, the analysis indicated that the SMEs may suffer an unequal share of compliance costs relative to larger companies and in relation to their size. Costs are expected to be particularly important for the SMEs during the first years of implementing the Regulations. As a result, these firms might experience a loss in competitiveness relative to larger firms. The precise extent to which the unequal share of costs will affect the competitiveness of the SMEs relative to larger firms was not evaluated.

The Regulations apply equally to domestic and foreign products; therefore, they are expected to provide a level playing field. From this perspective, the Canadian industry will not lose competitiveness relative to foreign producers. However, it was found that exporting firms might experience increased production costs if, for example, they have to separate production for the Canadian market from the production for the export market. Because exports of affected products represent a low percentage of total production, potential competitiveness losses are expected to be small.

Positive impacts to the competitiveness of the Canadian economy might result from the potential for innovation created by the Regulations. For example, manufacturers might be able to use the knowledge acquired through reformulating products affected by the Regulations to other areas of their business. The extent to which such positive competitiveness impacts will materialize is not yet certain.

Consultation

Throughout the risk management phase, three formal public consultation sessions were held with industry, environmental non-governmental organizations (ENGOs) and government stakeholders. The meetings were held in Toronto, on January 29, June 8 and November 18, 2004. Issues covered included the risk assessment report, the risk management strategy, the modelling and product-testing studies conducted in support of strategy development, and the choice of risk management instrument. Participants were supportive of federal government efforts and commended the effective and participative consultation process.

In addition, a technical workshop was organized with industry stakeholders to identify technical issues stemming from the working draft of the proposed 2-BE Regulations. The workshop took place in Ottawa on January 31, 2005.

A total of 22 written comments were received from stakeholders throughout the public consultation process: 18 from industry, 3 from ENGOs, and 1 from government. Many wrote seeking clarification. Comments received after the January 29, 2004 consultation session pointed to the uncertainties surrounding the relation between 2-BE product concentration, human exposure and the TC. Environment Canada and Health Canada conducted several modelling studies that analyzed these relations and served to develop the concentration limits set out in the Regulations. The results of these studies were presented in the June 8, 2004 public consultation session.

Other comments were concerned with the exposure of consumers to multiple products containing 2-BE, as well as the exposure of children to such products. The assumptions used in the exposure modelling studies reflect the human receptors that would be exposed to the highest air concentrations of 2-BE; therefore, they are considered to be conservative enough to develop concentration limits that will provide a safe exposure to all the Canadian population.

Comments received after the November 18, 2004 consultation session dealt with the design of the Regulations. One stakeholder suggested that the proposed Regulations focus on consumer products rather than on indoor-use products. Consumer products include some that are exclusively for outdoor use, which do not represent a concern in terms of human exposure to harmful levels of 2-BE. In addition, as people may have access to commercial or professional products, the Regulations include also commercial products for indoor-use.

Several stakeholders suggested that reporting requirements could be onerous for industry. In response, the proposed Regulations published in the Canada Gazette, Part I, included simplified reporting format and requirements to minimize industry's administrative burden.

Two stakeholders requested the exemption of commercial paint products. These products were not exempted, because consumers may have access to them through some commercialization channels. Another stakeholder showed concern about a product they commercialize that has a higher content of 2-BE than the proposed limits. The stakeholder claimed that there is no technically feasible replacement available. The Regulations have provisions that will allow manufacturers and importers to apply for permits for continuing to use 2-BE above the proposed concentration limits, in those cases where there are no technically or economically feasible alternatives or substitutes for 2-BE readily available, and where a plan has been prepared for complying with the proposed concentration limits. Permits will be issued for 24 months and will be renewable once.

Finally, one stakeholder suggested that a period of two years would be necessary for industry to comply with the Regulations, including time for reformulating and for selling pre-Regulation inventories. Stakeholders have been provided advance notice through extensive consultations that began in January 2004. The proposed Regulations granted a one-year grace period for the import and manufacture of products. In addition, the final Regulations provide a two-year period for the sale or offer for sale of products. Therefore, industry will have reasonable time to adapt to the Regulations.

Comments Following Pre-Publication in the Canada Gazette, Part I, on July 9, 2005

A total of 17 submissions were received from stakeholders. Most comments addressed specific sections of the proposed Regulations, whereas the rest were general comments or comments about the Regulatory Impact Analysis Statement (RIAS).

Several stakeholders commented on the application of the Regulations. In particular, they indicated that products intended for professional and commercial use are distributed through defined commercial outlets and are not available to consumers. For this reason, stakeholders suggested that professional and commercial-use products should be exempted from the Regulations. In addition, the Canadian Paint and Coatings Association (CPCA) proposed that an EPA be used as an alternative measure to control only indoor commercial paints and coatings.

This proposal has been accepted and an EPA addressing this specific issue has been developed. The purpose of the EPA is to provide assurance that all paint and coatings companies will take specific actions to ensure that any commercial paint and coatings for indoor use, containing 2-BE with a concentration exceeding the limits set out in Schedule 1 of the Regulations, will continue to be sold exclusively to industrial and commercial applicators and not to the general public. The EPA outlines roles and responsibilities for all signatory parties and includes a verification program.

In addition, the Regulations provide an exemption to automotive refinish coatings used in a commercial activity. Automotive refinish coatings used in commercial operations are sprayed in professionally designed spray booths and all users are trained in the safe use and handling of these coatings. These coatings are not intended to be sold to the general public. The health risk associated with these coatings is minimal and the exemption is expected to limit the burden on industry.

Stakeholders suggested that the maximum four-year time limit on permits was too short, based on the absence of adequate substitutes for certain applications. They also recommended that the permitting process mechanism be developed in advance of the Regulations entering into force. Finally, they indicated that the requirement of identifying whom the manufacturer or importer intends to sell should be removed, as this requirement would be impossible to fulfill by retailers who import or manufacture.

The Government of Canada considers that stakeholders have been provided advance notice through extensive consultations, beginning early in 2004. In addition, the Regulations will come into force one year after the day on which they are registered for the import and manufacture of products, and two years after the day on which the Regulations are registered for the sale or offer for sale of products. Therefore, the four-year time limit in permits is considered reasonable. The permitting process mechanism will be developed in advance of the Regulations entering into force and information will be distributed to stakeholders with compliance promotion material. The requirement concerning to whom the manufacturer or importer intends to sell has been removed from the Regulations.

The reporting obligations were seen as an onerous administrative burden to industry, without a counter-balancing benefit to the federal government or to human health. The rationale for it was perceived as unclear by stakeholders. The Government of Canada concluded that reporting is not necessary for the purposes of compliance and enforcement activities, and has removed the reporting requirements from the text of the Regulations.

Comments were submitted concerning the method and the cost of testing requirements. Environment Canada clarified that the testing requirements are only for the purpose of enforcement activities. There are no mandatory testing requirements in the Regulations for regulatees.

Other comments requested flexibility in the record-keeping format, specifically to allow for electronic and other media to be used in addition to hard copies. Furthermore, stakeholders suggested that keeping records at a Canadian civic address was not necessary and that record-keeping provisions should be harmonized with those from the Consumer Chemicals and Containers Regulations, 2001 under the Hazardous Product Act.

Though Environment Canada and Health Canada agreed to provide for the keeping of records in electronic media, the requirement of keeping records at a Canadian civic address was not removed, because it is necessary for inspection purposes. With regards to record-keeping provisions, these were harmonized with other Environment Canada regulations, and the period of five years is deemed necessary for inspection purposes. Harmonizing record-keeping provisions with those from the Consumer Chemicals and Containers Regulations, 2001 was not considered.

Comments concerning the coming into force of the Regulations indicated that a period of two years or more would be necessary for industry to fully reformulate and sell pre-Regulation inventories. Other comments suggested that products manufactured prior to the coming into force of the Regulations should be exempted.

The Regulations were modified to allow for the sell and offer for sale of pre-Regulation inventories for two years after the Regulations are registered. The coming into force of the manufacture and import provisions will remain at one year. Stakeholders have been provided advance notice through extensive consultations, since early 2004.

Stakeholders felt that a clearer statement that the concentration limits for 2-BE are intended to apply to the ready-to-use final products as stated by the manufacturer and not to the concentrated products is needed. The concentration limit of 0.1 percent for 2-BE content in spray paint was identified as illogical and unjustified, because 2-BE is very likely to be present in trace amounts in certain mixtures. Some stakeholders suggested that the Wall Paints Exposure Model should be used to determine the concentration limits of 2-BE for paints, instead of the ConsExpo consumer exposure model.

The regulatory text was changed to clearly indicate that the concentration limits for 2-BE are intended to apply to the final products in ready to use form and not to the concentrated products. The concentration limit of 0.1 percent for spray paints was not changed. The exemptions and the permits system provide enough flexibility to industry to comply with the concentration limits. Health Canada and Environment Canada have reviewed the Wall Paints Exposure Model and have concluded that the ConsExpo model is more appropriate in establishing 2-BE concentration limits for paints and coatings.

General comments referred to the perceived lack of harmony with the United States and European legislation, as well as the fact that the U.S. recently removed 2-BE from their Hazardous Air Pollutant list.

Environment Canada and Health Canada acknowledge that the U.S. Environmental Protection Agency removed 2-BE from their Hazardous Air Pollutant list, because concentrations of 2-BE in ambient air are below levels of concern. However, 2-BE has not been addressed in the context of indoor-air applications in the U.S. or in Europe. These Regulations control indoor-air concentrations of consumer and commercial products containing 2-BE. The Government of Canada is taking a proactive and leading role in regulating 2-BE, in order to protect the general public.

Stakeholders also submitted comments on the RIAS that was pre-published in the Canada Gazette, Part I, together with the proposed Regulations.

Some comments indicated that the RIAS led one to believe that industrial paints and coatings were included in the scope of application of the Regulations. This was clarified in the present RIAS; industrial applications are not part of the scope of the Regulations.

Industry expressed concern about the potential for duplicating reformulation costs to comply with these Regulations and with future initiatives controlling VOCs in the same products. Stakeholders also indicated that incremental costs associated with future controls on VOCs should be factored into the cost analysis of these Regulations.

Costs associated with other initiatives will be included as part of the impact analysis of those initiatives. Public consultations on initiatives under development for controlling the VOC content in a range of product categories have provided industry with information about the objectives and intent of the Government of Canada. Therefore, industry may be able to reformulate once, to take into consideration the concentration limits set out by the Regulations and the VOC initiatives. In cases where this is not possible, industry may need to reformulate twice.

Some stakeholders indicated that if the health benefits are real they should be quantifiable. The health risk posed by 2-BE is real and was established through the risk assessment. However, this health risk was deemed not quantifiable because of the lack of epidemiological data. As a result, the health benefits stemming from the Regulations cannot be quantified or monetarily measured. The analysis of benefits was qualitative and relies on indicators of the number of people predicted to use products that could result in harmful exposure to 2-BE.

The "Net benefits" section of the RIAS was construed by some stakeholders to indicate that the net benefits of the Regulations are negative. This resulted from a straight comparison of quantitative costs and qualitative benefits. Such comparison can only be qualitative in nature. The net benefits cannot be quantified with the available information and knowledge. The name of the section was changed to "Conclusion", to better reflect its content and purpose.

One stakeholder brought up the possibility that Canada's ability to compete for new global investment may be limited, as a consequence of the restrictions imposed by these Regulations. The Regulations provide for a level playing field, whereas firms operating within Canada and firms operating abroad are subject to the same requirements for commercializing their products in the Canadian market. The Regulations will not trigger incremental costs for firms operating in Canada when compared with firms operating abroad, and are therefore not expected to have any material implications on firms' global investment decisions.

On March 23, 2006, Environment Canada and Health Canada held an information session in Toronto. The purpose was to inform stakeholders of the proposed response to comments received after pre-publication of the proposed Regulations in the Canada Gazette, Part I. The proposed changes for the final regulatory package and the proposed EPA were also presented. General feedback on the proposed modifications was positive, and stakeholders appreciated the opportunity to hear what was being considered for the final Regulations. The meeting also provided an opportunity to discuss the EPA with stakeholders. Feedback on the EPA from the participants was positive.

Compliance and Enforcement

As the Regulations are promulgated under CEPA 1999, enforcement officers will, when verifying compliance with the Regulations, apply the Compliance and Enforcement Policy implemented under the Act.

The Policy outlines measures designed to promote compliance, including education, information, promoting of technology development and consultation on the development of Regulations. The Policy also sets out the range of possible responses to violations: warnings, directions,environmental protection compliance orders, ticketing, ministerial orders, injunctions, prosecution, and environmental protection alternative measures (which are an alternative to a court trial after the laying of charges for a CEPA 1999 violation). Furthermore, the Policy explains when Environment Canada will resort to civil suits by the Crown for costs recovery.

When, following an inspection or an investigation, an enforcement officer discovers an alleged violation, the officer will choose the appropriate enforcement action based on the following factors:

Contacts

Alex Cavadias
Head
Volatile Organic Compound Controls Unit
Chemicals Sector Division
Environment Canada
351 St. Joseph Boulevard, 12th Floor
Gatineau, Quebec
K1A 0H3
Telephone: (819) 953-1132
FAX: (819) 994-0007
E-mail: alex.cavadias@ec.gc.ca

Markes Cormier
A/Senior Economist
Impact Analysis and Instrument Choice Division
Environment Canada
10 Wellington Street, 24th Floor
Gatineau, Quebec
K1A 0H3
Telephone: (819) 953-5236
FAX: (819) 997-2769
E-mail: markes.cormier@ec.gc.ca

Footnote a

S.C. 2004, c. 15, s. 31

Footnote b

S.C. 1999, c. 33

Footnote c

S.C. 2002, c. 7, s. 124

Footnote d

S.C. 1999, c. 33

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