Frequently Asked Questions – Regulatory Reforms

The One-for-One Rule came into effect on April 1, 2012, and received Royal Assent as the Red Tape Reduction Act on April 23, 2015.  The Rule places strict controls on the growth of federal regulatory red tape imposed on business. It requires regulators to offset any administrative burden cost increases from new regulatory changes with equal reductions from existing regulations. Under the One-for-One Rule, for every new regulation added that imposes an administrative burden on business, one must be removed.

And there is evidence that the One-for-One Rule is working. For example:

• Public Safety Canada recently amended the government's Accounting for Imported Goods and Payment of Duties Regulations by increasing the threshold from $1,600 to $2,500 for shipments to qualify under the Low Value Shipment (LVS) program and benefit from a streamlined process. This regulatory change allows courier companies to use a consolidated document for the release of imported goods instead of a document for each shipment and importers will no longer have to present release request entries or manifests to their local Canada Border Services Agency office in order to obtain release of these goods. Allowing more shipments to be processed through the low value stream is expected to save businesses $688,221 in administrative costs per year.
• Public Works and Government Services Canada recently amended the government's Controlled Goods List, in part by removing items that no longer need to be targeted.  With fewer items on the list and fewer organizations needing to register with the Controlled Goods Program, the administrative burden on businesses, particularly in the aerospace, defence, satellite and security industries, will decrease.  Fewer companies will now require security officials, security assessments, on-site or telephone compliance inspections, and associated audits. The expected savings in administrative costs are valued at $710,047 a year.

Administrative burden describes the effort required for Canadians or business to demonstrate compliance with a federal regulation. Under the Red Tape Reduction Act, administrative burden is defined as "…anything that is necessary to demonstrate compliance with a regulation, including the collecting, processing, reporting and retaining of information and the completing of forms".

Regulators are required to calculate the direct costs of these activities when regulatory changes impose new administrative burden on business.

For further information, please see the Guide for the One-for-One Rule. 

The Standard Cost Model (SCM) is used to calculate administrative burden under the One-for-One Rule. The SCM is an internationally accepted way to estimate the administrative burden costs to business resulting from information and reporting obligations included in a regulation.

TBS monitors implementation of the One-for-One Rule. To demonstrate results to business and Canadians, a Scorecard Report is published to report progress on system-wide reforms each year, including implementation of the One-for-One Rule.

The latest 2013-2014 Scorecard Report was published on January 21, 2015, and was reviewed by the Regulatory Advisory Committee.

The small business lens requires regulators take into account the impact that new or amended regulations have on small business.

Regulators will now be required to include an analysis of impacts on small business, a summary of consultations and a summary of the government's efforts to minimize burden on small business in their Regulatory Impact Analysis Statements.

The Regulatory Impact Analysis Statement includes a 20-point checklist that is published with the proposed regulation. It describes the government's regulatory action and its impact on the environment, health, safety, security, social and economic well-being of Canadians. The checklist will drive efforts to minimize burden on small business, avoid bureaucratic duplication and communicate regulatory requirements in clear, plain language.

The Small Business Lens is also featured as a cross-cutting tool in the Canada-United States Regulatory Cooperation Council Joint Action Plan, in which Canada and the United States agreed to share approaches and tools to assess and account for the needs of small businesses when developing regulations.

A "small business" is defined as any business with fewer than 100 employees or between $30,000 and $5 million in annual gross revenues.

The small business lens is triggered when a significant regulatory change imposes over $1 million in annual nation-wide costs, or a disproportionate impact on small businesses.

Integrating the results of the small business lens into the Regulatory Impact Analysis Statement allows small business owners to judge for themselves, and to comment on, the government's efforts to minimize regulatory burden.

Results of cost savings to small businesses when the lens is applied will be published in the Regulatory Impact Analysis Statement. The small business lens Checklist will also be posted publicly. Each document will be available in the Canada Gazette.

Interpretation policies explain how regulators interpret regulations. They also provide information on when regulators will respond to questions from stakeholders in writing about how to meet regulatory requirements.

These polices will bring transparency and predictability to the regulatory process by providing business with information on how they are to meet their regulatory requirements.

Forward regulatory plans are lists of planned and potential new regulations or amendments that a regulator plans to introduce over a 24-month period.

As these plans are early estimates of upcoming regulatory changes, they will be produced annually and updated once per year to reflect changing circumstances.

Forward regulatory plans will include the title of the regulatory proposal, a brief description of the regulatory proposal, planned public consultations, and instructions on how to obtain further information.

Posting Forward Regulatory Plans gives Canadians and businesses advance notification of upcoming regulatory initiatives providing stakeholders more time to plan for the future.

Forward regulatory plans will be posted on the websites of regulators later this fall.

There will also be links to all forward regulatory plans from the TBS website.

Service standards are a public commitment to a measurable level of performance that clients can expect under normal circumstances.

Service standards for regulatory authorizations will focus on meeting commitments for timely approval processes.

Regulatory authorizations grant permission to conduct a regulated activity in compliance with federal laws and regulations.

Typically, a regulated party will submit an application to the Government of Canada that, if successful, will result in the issuance of a permit, licence, or certificate (e.g., issuance of a certificate of export for natural health products).

Service standards for regulatory authorizations enhance predictability by clarifying expectations and enabling businesses to plan accordingly.

The ABB count is a baseline inventory of the number of administrative requirements in federal regulations and related forms that impose burden on businesses in Canada.

Federal government departments and agencies have made their individual ABB counts publicly available on the Acts and Regulations pages of their websites. A list of Government-wide Administrative Burden Baseline counts is also available.

The Government of Canada committed to identifying and counting administrative requirements imposed on businesses in Canada through federal regulations and associated forms.

By counting and publishing this information, the ABB count contributes to the openness and transparency of the federal regulatory system.

The ABB initiative’s scope included all Governor in Council (GIC) and non-GIC regulations in relevant federal departments and agencies with requirements that impose administrative burden on business.

The new Cabinet Directive on Regulatory Management incorporates the regulatory reforms outlined in the Red Tape Reduction Action Plan.

The new directive will continue to ensure regulations provide for the greatest net benefits to current and future generations of Canadians.

The new Cabinet Directive provides direction to federal regulators on implementing the following regulatory reforms:

• The "One-for-One" Rule;
• Small business lens;
• Forward regulatory plans;
• Service standards; and
• The Annual Scorecard Report.

The substantive changes to Canada's regulatory policy emanates from the government's Action Plan Response to the Red Tape Reduction Commission's Recommendations Report. Those recommendations were the product of extensive national and regional engagement. Between January 2011 and January 2012, the Commission hosted 15 round table sessions in 13 cities, attracting nearly 200 participants. An online consultation and the website further enabled members of the broader community to give their views on federal red tape.

The new Cabinet Directive on Regulatory Management has all of the elements of Canada's previous regulatory policy, the Cabinet Directive on Streamlining Regulations. It simply adds the systemic regulatory reforms.

The government has taken important steps to reduce the administrative and paperwork burden on Canadian businesses. In March 2009, the government fulfilled its Budget 2007 commitment to reduce paperwork burden by 20 per cent under the Paperwork Burden Reduction Initiative (PBRI).

The PBRI is a federal initiative whose goal is to relieve small and medium-sized enterprises (SMEs) of the excessive paperwork burden of regulatory compliance while ensuring Canada continues to have strong, effective regulations to protect individuals, the environment and the economy.

The government will take action to report on the administrative burden that comes from federal regulations. To do this, starting in September 2014 and annually thereafter, the government will refresh the section of the 2007 Paperwork Burden Reduction Initiative inventory that identifies requirements in federal regulations that impose administrative burden on business.