Mining Law, in the Canadian context, is generally understood to include all legal issues relating to the mineral exploration, development, production, and reclamation cycle: that is to say, from raw grassroots exploration through to the fabrication and ultimate sale of finished metal product, as well as mine closure and reclamation. It deals with such items as exploration and development agreements; joint ventures, syndicates, and royalty agreements; mining taxation; project financing, structured financing, capital markets financing, and the corporate and technical due diligence relating thereto; related infrastructure development and financing; engineering and service contracts; processing, refining, and metal sales contracts; intellectual property issues relating to mineral and mining technologies; mining commissioner and severance disputes; mineral policy and mineral strategy issues; and related socio-economic and environmental issues. It can be said to include the extractive sectors.
New Regulatory Environment
In an interview with Lexpert® Magazine, Janice Walton, counsel at Blake Cassels & Graydon LLP in Vancouver, identified several changes to Canadian environmental law affecting the mining sector and trends that have been occurring for the past 30 years. The mining industry is often dealing with projects that take “a very, very long time to go from early exploration stage to up-and-running; a very long time,”1 she said. When changes to the mining laws and environmental assessment laws, and to the principle regulatory statutes such as the Fisheries Act, are made partway though the process, “it creates a level of uncertainty that can be difficult.”
In Canada, an environmental assessment is needed for a mine being built. The environmental assessments regime that had been established in Canada was replaced in 2019 with the Impact Assessment Act. The Fisheries Act has been changed several times. In British Columbia, Walton is seeing increasing implementation of the Species at Risk Act. “We’re seeing more and more … complications occurring, where the federal government wants to take a certain action, but most of the concerned legislation is provincial. It’s a balancing act. In BC, efforts are also underway to protect mountain caribou, and a conservation agreement is still in draft form.
“This will certainly have an impact on resource companies in the areas of mining and other resource sectors. That kind of thing can be very challenging; it creates uncertainty, which reverberates in [the] market.” Sometimes, the best advice to clients is to maintain good working relationships with the regulators, Walton said.
Canada Expected to Pass the Transparency In Supply Chains Act
Canada is expected to soon join other Western nations in passing legislation on modern-day slavery in supply chains.
In April 2019, the All-Party Parliamentary Group to End Modern Slavery and Human Trafficking announced the completion of the draft Transparency In Supply Chains Act (TSCA). The parliamentary group was launched in April 2018. The TSCA would impose obligations on Canadian businesses to take steps to prevent the use of modern slavery in their overseas supply chains, and create reporting obligations on qualifying entities, including completion of a supply chain questionnaire on a company’s policies and procedures related to forced labor, child labor, and human trafficking. It would also establish a duty of care for all businesses meeting a regulated annual turnover threshold.
Canada could soon join other jurisdictions like California, the United Kingdom, Australia, and European countries such as France, the Netherlands, and Norway who have already passed such legislation. Companies in these jurisdictions must also publish their findings on their corporate websites. In the UK and Australia, the company’s board of directors must sign off on such a report, said Stephen Pike, a partner at Gowling WLG in Toronto who advises global and Canadian businesses, in Canadian Lawyer. “What we’re seeing around the world is more and more legislation and mandatory due diligence,”2 said Pike.
Industries such as mining have been playing attention to their supply chains. This is, in part, in light of class-action lawsuits such as that against Vancouver-based Nevsun Resources, charged in 2014 by three Eritreans of using forced labor at its Bisha mine in Eritrea. (The Supreme Court of Canada heard arguments in the case in January 2019.) “Certainly from an ESG or sustainability perspective, mining companies are going to need to and want to get ahead of that, and make sure that they go through their supply chain and ensure that they don’t have any of those kinds of risks there,” said Kellie Johnston, a senior member of Norton Rose Fulbright LLP’s global risk advisory practice, in Canadian Lawyer.
- Raymer, Elizabeth. “The new world of stakeholder engagement.” Lexpert® Special Edition — Mining. March 2, 2020. https://lexpert.ca/article/the-new-world-of-stakeholder-engagement/.
- Raymer, Elizabeth. “Canada expected to pass legislation on modern-day slavery in supply chains.” Canadian Lawyer. January 30, 2020. https://www.canadianlawyermag.com/news/general/canada-expected-to-pass-legislation-on-modern-day-slavery-in-supply-chains/325664.