Canada’s transportation laws and regulations

Know more about Canada’s transportation laws and regulations, and how can transportation lawyers help businesses and companies with this article
Canada’s transportation laws and regulations

The practice of Transportation (Road & Rail) lawyers is generally understood to encompass a broad spectrum of functions, including licensing regulation and licensing applications in Canada and the US, advising on transportation contracts, advising on Canada customs and US customs matters, acting in relations to the national and international transportation aspects of mergers and acquisitions; National Transportation Agency filings; and advising with respect to the transport of environmentally sensitive or dangerous goods and hazardous wastes. 

Please note that the Lexpert directory has separate pratice areas for: 

Canada Transportation Act (CTA) 

Transportation laws is a broad branch of law which regulates the conduct of the transportation sector, mainly its three areas – land, air, and sea. Its general purpose is to ensure the safety of all persons involved in its operations, put up licensing and registration regimes for the operators, and establish the rights and liabilities of each party when accidents happen (e.g., collisions, wreckage, death, injuries, loss of cargo, etc.).  

A transportation lawyer, in his/her legal practice, may focus in one area of transportation law, or focus on an aspect of it (either transactional or litigation), or even both. 

Although Canadian laws on transportation may differ when it comes to its application on the specific areas of land, air, and sea, the Canada Transportation Act (CTA) is the federal legislation regarding Canada’s transportation sector. The CTA declares Canada’s National Transportation Policy (Section 5), which aims for a national transportation system that is compliant with the safety and security standards, contributing to the sustainability of the environment, and serving the needs of the public effectively and cost-efficiently. 

Parts of the CTA 

The CTA is divided into major Parts.  

  1. Part I simply establishes the Canadian Transportation Agency (the Agency), its administration and officers, and its legal relationship with the Governor in Council and the Minister of Transport (Minister). Section 53.1 (1) under Part 1, in relation with the Competition Act, requires parties to a merger and acquisition (M&A) to file a notification for review before the Agency or the Minister on the said M&A when it involves the transportation sector. This notification must be filed by companies, with assistance by a transportation lawyer, since an M&A would not be declared complete without the review by the government agency concerned. 
  2. Part II governs air transportation. 
  3. Part III governs land transportation but specific to railway transportation. Here, a transportation lawyer would be able to outline the differences of the applications of the law to the different areas of transportation law, since there are some nuances between them. 
  4. Part IV outlines the grounds and scopes of arbitration when it comes to matters arising out of the relationship between shippers and carriers, such as in contracts of carriage through land, air, or sea. As such, the assistance that a transportation lawyer may provide also includes enforcing an arbitration clause in a contract of carriage or in an arbitral provision of law, or representation in an arbitral proceeding to prevent litigation between the parties and for them to amicably resolve said dispute. 

Section 105, CTA 

Under Part III, Section 105 of the CTA states that any document evidencing any of the following transaction relating to a rolling stock (a railway vehicle) must be deposited with the Registrar General of Canada: 

  • Lease 
  • Sale, including Conditional Sale or Instalment Sale 
  • Mortgage 
  • Hypothec 
  • Bailment 
  • Leasing 
  • Deposit 
  • Security agreement 

It includes any amendment, assignment, or discharge with regards to the above-mentioned document. The effect of the depositing of these documents is that it would be binding against all persons who are not a party to such transaction and would make such deposit be equivalent to any requirement of other laws mandating the depositing or registering of said documents in another government agency. 

What is Bill C-49? 

Bill C-49 amended the provisions of numerous laws, including the Canada Transportation Act (CTA), especially its provisions on air and land transportation. 

Bill C-49 Amendments to the Canada Transportation Act (CTA) 

As to air transportation, the Bill required that a new air passenger rights regime must be crafted by the Canadian Transportation Agency. Through its amendments, the Governor in Council is now authorized to create regulations requiring air carriers to report about their passenger experience or quality of service for regulation purposes. 

For land and railway transportation, the Bill expanded the regulating powers of the Governor in Council by requiring major railway companies to report to the Minister and to the Agency any necessary information relating to their rates, service, and performance. It also:  

  • Repealed the CTA provisions regarding insolvency and bankruptcy so that other laws on insolvency and bankruptcy will apply to the transportation sector;  
  • Established new remedies for parties in a contract of railway transportation, such as a new remedy for shippers in instances of long-haul interswitching (Section 129, CTA); 
  • a remedy for non-compliance of companies with the new process of transferring;  
  • and discontinuing railway lines (Division V, CTA).  
  • Amended some CTA provisions on arbitration where the maximum amount for the summary process is now increased to C$2 million (Section 164.‍1, CTA) and the decision of the arbitrator is now applicable for a period up to two years upon request by the shipper (Section 165(2), CTA). 

For other amendments by Bill C-49 on other laws, such as amendments to the CN Commercialization Act, Railway Safety Act, and among others, companies are advised to consult with a transportation lawyer. 

Interested about your air passenger rights in Canada? Find out about the basics of civil aviation regulations that protect passengers like you.

What is the Railway Safety Act of Canada?  

The Railway Safety Act is the federal law enacted to ensure the safety of all federal railways in Canada by regulating railway operators or railway companies. As provided in Section 3, the Act puts the responsibility – and the liability – to these operators and companies in ensuring the security of its operations by continuously mitigating risks related to safety measures and by continuously enhancing these railway systems. 

As stated in Section 2, the Act generally applies to all railway companies in Canada – both in the private sector and those which are publicly owned. Railways run by the private sector are those which are managed by the private persons or businesses who own paths, trails, and roads crossing railway tracks. On the other hand, publicly owned railways are those which are managed by the federal, provincial, or municipal governments, including its departments and agencies. 

When covered by the Act, railway businesses must be registered with the Transport Canada. In complying with the Act and its regulations, a transportation lawyer can be consulted to faithfully follow its registration and operational requirements. 

Who regulates road transportation in Canada? 

Generally, it is the federal government, through Transport Canada, that regulates international and inter-provincial transportation. However, provinces and territories also have jurisdiction over transportation regulation, especially when it comes to intra-provincial transportation. 

What are the other Acts for which Transport Canada is responsible for?  

Aside from the above-mentioned Acts (Canada Transportation Act and Railway Safety Act), the Transport Canada is also responsible for the implementation of the following laws: 

Engaged in the business of transportation? Consult with the best transportation lawyers in Canada for any of your legal needs by heading down below.