Supreme Court ruling to reshapes Canadian environmental assessment rules

In a landmark decision that has reignited the age-old debate about the division of powers between federal and provincial authorities, Canada’s Supreme Court has declared certain provisions of Canada's Impact Assessment Act (IAA) unconstitutional. The Oct. 13 ruling, delivered with a 5-2 majority, specifically found the IAA's provisions related to the assessment of "designated projects" to be outside the jurisdiction of the federal Parliament and, therefore, unconstitutional.

This decision challenges Canada's approach to environmental assessments and is expected to lead to significant revisions to the IAA, which was passed in 2019.

The Court's unanimous decision affirmed the IAA's validity concerning projects carried out or financed by federal authorities on federal lands or outside Canada. However, in its opinion on the IAA's scheme for designated projects — typically large-scale or significant developments within Canada that may substantially impact the environment and surrounding communities — the Court's justices were divided, causing the 5-2 split.

Designated projects undergo a more thorough assessment process to ensure responsible development.

In its response, the Mining Association of Canada (MAC) noted the uncertainty caused by the ruling will hurt the mining industry and Canada’s energy transition.