Policy framework to implement the Environmental Violations Administrative Monetary Penalties Act: chapter 4

4.0 Determining the amount of the penalty

1. 4.1 Who is subject to an AMP?
2. 4.2 The violation types
3. 4.3 Aggravating factors

The legislative requirements found in EVAMPA and the AMPs Regulations set out how the amount of the penalty is determined.

The AMPs Regulations include schedules listing each provision of the Environmental Acts and associated regulations that are designated as a violation and that may be enforced by means of an AMP if contravened. The schedules also specify how each violation has been classified (Type A, B or C) as well as listing the penalty amounts.

The method of determining the amount of an AMP is outlined in Schedule 4 of the AMPs Regulations. The baseline penalty amount is pre-determined, based on the category of violator and whether the violation is classified as a Type A, B or C violation.  The AMPs Regulations also set out three aggravating factors: history of non-compliance; environmental harm; and economic gain. If any of these aggravating factors apply to the violation, a set amount is added to the baseline amount, which increases the overall penalty amount. 

Baseline + Aggravating Factors (if applicable) = Penalty Amount

Table 1 below sets out the method of determining the penalty amount as found in Schedule 4 of the AMPs Regulations.

4.1 Who Is subject to an Administrative Monetary Penalty?

EVAMPA specifies that the following types of violator are subject to AMPs:

• Individual
• Other person, ship or vessel

Any incorporated entity, such as a corporation or a university, is considered to be an “other person” for the purposes of EVAMPA and the AMPs Regulations.

Sections 8 and 9 of EVAMPA provide further details regarding who is considered liable for the commission of violations. Directors, officers, agents and mandataries of corporations; owners, operators, masters or chief engineers of ships or vessels; and pilots of aircraft can be found liable to an AMP in certain circumstances, even if they themselves did not commit the violation.

Are directors and officers liable for AMPs?

Yes. Under section 8 of EVAMPA, any director, officer, agent or mandatary of a corporation who directed, authorized, assented to, acquiesced in or participated in the commission of the violation is party to the violation and is liable to an AMP.

Directors and officers of corporations owning or operating a ship or vessel that commits a violation may be subject to an AMP if they have directed or influenced the corporation’s policies or activities in respect of conduct that is the subject matter of the violation.

Will government departments be subject to AMPs, and if so, what type of violator are they?

Yes. Government departments have a responsibility to comply with environmental legislation and may be issued a Notice of Violation. Government departments fall in the category of “other person, ship or vessel”.  

Will Indigenous governments, Bands and Band Councils be subject to AMPs?

According to section 7 of EVAMPA, an AMP can be issued to every person, ship or vessel that fails to comply with a designated provision.   Generally, a Notice of Violation would be issued to an individual; however, each situation is different and will be examined separately.

4.2 The violation types

Section 3 of the AMPs Regulations designates violations as Type A, B or C violations, where: 

• Type A are violations that represent less serious compliance issues and would typically be administrative in nature, such as failing to respect a reporting requirement or failing to keep records as required by regulations;
• Type B are violations that represent more serious compliance issues and that create a risk of harm to the environment or constitute an obstruction of authority.

Example 1 of a Type B violation:
A hunter is found hunting a black duck, a species of migratory game bird, outside of open season in violation of subsection 5(4) of the Migratory Birds Regulations.

Example 2 of a Type B violation:
A person is found transporting hazardous waste without being named on a valid transit permit. This is a violation of paragraph 22(b) of the Export and Import of Hazardous Waste and Hazardous Recyclable Material Regulations.

• Type C are violations that represent the most serious compliance issues and, by their nature, will always result in harm to the environment.

Note that for Type C violations, the environmental harm aggravating factor will not apply because these violations are inherently harmful to the environment and this factor is already reflected in the baseline AMP amount.

Example of a Type C violation:
A person has released, or allowed or caused the release of, a halocarbon that is contained in a refrigeration system or an air-conditioning system, which is a violation of paragraph 3(a) of the Federal Halocarbon Regulations, 2003.

4.3 Aggravating factors

If any of the following aggravating factors are present in the case of a particular violation, the officer must apply the amount of the factor to the total amount of the AMP.

Aggravating Factor 1 - History of non-compliance

According to subsection 6(2) of the AMPs Regulations, a violator has a history of non-compliance if, in the five years preceding the commission of a violation relating to:

1. any Division of Part 7 of CEPA or any regulation made under that Division,  they were subject to an enforcement action in relation to that Division or any of those regulations;
2. Part 9 of CEPA  or any regulation made under that Part, they were subject to an enforcement action in relation to that Part or any of those regulations; or
3. any Environmental Act, other than CEPA or a regulation made under one of those Acts, they were subject to an enforcement action in relation to that Act or any of that Act’s regulations.

Subsection 6(3) of the AMPs Regulations defines “enforcement action” as meaning “the imposition of a ticket, penalty, conviction or injunction or the use of environmental protection alternative measures.”  

An officer will apply the aggravating factor of history of non-compliance to increase the penalty amount of the AMP when an individual or other person, ship or vessel has been subject to an enforcement action as identified in the definition of history of non-compliance. The amount added will vary depending on the type of violation and the category of violator, as set out in column 4 of Table 1 above.  

Example:
A person exports hazardous waste to another country without the required export permit, issued under section 185 of Division 8, Part 7 of CEPA. The same person has been subject to an enforcement action under Division 8, Part 7 of CEPA for a violation committed within the last five years. In this example, should the officer decide to issue a Notice of Violation for this violation, they will add on the amount set out in column 4 of Table 1 to the baseline amount set out in column 3 of Table 1 above.

Will the aggravating factor of history of non-compliance be applied on a facility-wide or corporation-wide basis?

As a general rule, the AMP regime will apply on a corporation-wide basis. However, in each case, officers will consider the current violation and any previous history of non-compliance by the facility and the corporation, as well as the relationship between the facility and the corporation in order to determine if the corporation’s history of non-compliance has to be taken into consideration.

Aggravating Factor 2 - Environmental Harm:

Environmental harm will be found to exist in the event of the observation or measurement of any of the following:

• alteration, disruption or degradation of biodiversity ecosystem or habitat;
• killing, harming, harassing, capturing or taking of wildlife species;
• removing, defacing, damaging or destroying any cultural resource, including an artifact; or
• any adverse effect, such as contamination or degradation and including harm caused by the release of any solid, liquid, gas, odour, heat, sound, vibration or radiation.

If the violation causes harm to the environment, an officer will add on the amount set out in column 5 of Table 1 to the baseline amount set out in column 3 of Table 1, depending on the type of violation and the category of violator.              

Example:
Section 125 of CEPA prohibits the disposal of a substance at sea except under the authority of a permit and unless certain conditions are met. Since the disposal of a substance at sea may or may not result in environmental harm, violating any of these provisions is classified as a Type B violation. If harm actually occurs, the amount of the penalty will be increased due to the application of the “environmental harm” aggravating factor.

Aggravating Factor 3 - Economic Gain

Economic gain refers to any revenue, profit, or income obtained, or any costs avoided or delayed, whether directly or indirectly, as a result of non-compliance with the environmental legislation specified in the Notice of Violation issued to the violator.

If economic gain is found to exist, an officer will increase the baseline penalty amount set out in column 3 of Table 1 by the amount set out in either column 7 or 6 of Table 1, above, depending on whether the economic gain resulted from the avoided cost of obtaining a required permit, licence, or other authorization, or whether any other economic gain resulted from the violation, such as additional income, profits or other benefits being realized.

Example:
In order to operate a taxidermy business, a person must have a taxidermy permit, under section 29 of the Migratory Birds Regulations (MBR). This permit must be purchased at the cost prescribed by Schedule II of the MBR. If the person did not purchase the taxidermy permit and is operating a taxidermy business illegally, then the AMP calculated for the violation would be increased by 25 percent to account for the avoided cost of obtaining the permit.

Will economic gain include potential gain?

No. Economic gain will only include realized gains.

What if the economic gain realized is greater than the amount that can be added to the penalty for a given violation?

Officers will take into account the magnitude of the economic gain when determining the most appropriate enforcement measure to secure compliance. If the officer decides to issue an AMP, the amount added for the economic gain as an aggravating factor is set in Schedule 4 of the AMPs Regulations.

Will the option of negotiating a settlement be available for AMPs?

No. There is no authority to accept a settlement in a case where a Notice of Violation has been issued and the violator would like to settle for a lesser amount. If violators wish to contest the amount of the AMP they have received, they may ask the Chief Review Officer for a review of their AMP.

Are mitigating factors available to decrease the amount of the AMP?

No. There are no mitigating factors to reduce the amount of an AMP.

Maximum Penalties

According to subsection 5(4) of EVAMPA, the maximum penalty for an:

1. Individual is $5,000
2. Other person, ship or vessel is $25,000

Each day that a violation continues will be considered as a separate violation for which a separate AMP can be issued.

If an officer issues an AMP for a violation, an AMP can be issued for every day that the officer determines a violation took place or is ongoing. For each AMP, this amount cannot surpass the maximum penalty amount set out in EVAMPA.