FAQs | Modernizing Fees for Marine Cargo Services | Let's Talk Transportation

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What is fee modernization?

The Fee Modernization Initiative will update existing service fees and introduce others so we can:

  • ensure that those who benefit from Transport Canada (TC) services pay a greater portion of the costs 
  • continue to respond to industry demands to support innovation and use of modern technologies
  • continue to provide high quality services for business, employment and recreation. 

Why does TC need to modernize fees for marine cargo services?

The existing fees for these services have not been adjusted in approximately 20 years despite: 

  • inflationary increases in wages;
  • updated requirements under International Codes;
  • increase in exports; and
  • modern shipping and handling methods and ship designs.

A key principle underlying any cost recovery initiative is that service recipients who receive a direct benefit above those enjoyed by the general public should pay a greater share of the costs.  Modernizing the fees for marine cargo services ensures that this principle is realized.

Currently, vessel operators are subject to a complex fee structure for marine cargo services, comprising of 40 different fees spread out over three separate regulations. Such a structure is confusing, inconsistent and makes cost predictability difficult to calculate.

Under the Marine Cargo Fee Modernization proposal, TC proposes to:

  • consolidate and simplify the marine cargo regulatory fee structure
  • update and/or add new fees to better reflect the true cost of delivering these services

What are the features of the new proposed fee structure?

The proposal suggests that TC reduce the number of fees from 40 to five:

  • Certificate Day Fee ($1,900)

    One daily fee per calendar day, per vessel, that a certificate is issued (i.e. readiness to load (RTL), fitness to proceed (FTP), and/or preliminary certificates).
  • Non-Certificate Day Fee ($512)

    One daily fee per calendar day, per vessel, that an inspector is requested to be available. No certificate is issued on that calendar day, but an inspector is available or is available and makes an inspection.

These daily fees:
  • include overtime and travel costs, so there will be no separate charges for those items;
  • have no separate fee per certificate when issued; and
  • have no separate fee for amounts of cargo (tonnage loaded), regardless of type.
It should also be noted that in accordance with the proposal:
  • if more than one certificate is issued on the same calendar day, TC will only charge one Certificate Day Fee; and
  • if two inspectors are asked to be available for the same vessel on a calendar day, TC will charge two Non-Certificate Day fees.
At the same time, TC is proposing to replace existing hourly fees for inspections of bulk and packaged dangerous goods with a fee of $1,500 per inspection. Furthermore, TC is also proposing to create two new fees to recover a portion of the cost of Verification of Shippers Procedures as this service is currently provided free of charge; one fee of $2,500 for Initial or Modifications verifications, and a separate fee of $1,250 for Intermediate or Renewal verifications.

How were TC’s full costs determined for marine cargo services?

Full cost is the allowable upper limit of a service fee and represents the departure point for pricing.

A full cost estimate comprises all relevant resource costs incurred to deliver an activity or provide a service, including:

  • employee salaries;
  • operating and maintenance;
  • amortization of capital assets;
  • program support;
  • internal services;
  • centrally managed costs, such as employee benefit plans; and
  • services provided by other departments, such as office accommodations.

Were stakeholders informed that TC plans to modernize its fees?

Yes. Presentations were made to raise awareness and seek input from industry members at the regional and national plenary sessions of the Canadian Marine Advisory Council (CMAC) meetings held between December 2017 and May 2018. These presentations outlined the goals and time frames associated with this initiative. Stakeholders were provided the opportunity to ask questions and provide input.

How can stakeholders participate in this public consultation?

As we consider modernizing the fees for marine cargo services, we are asking for stakeholder feedback throughout the process.

From February 13, 2019 through April 12, 2019, we are inviting stakeholders to read the Fee Modernization proposal published on the Let’s Talk Transportation website, where stakeholders can provide their feedback. Input and comments submitted through the webpage will be recorded and considered in the development of an amendment to the applicable regulations.

Finally, the proposed amendments to the regulations will be published in Canada Gazette for consultation prior to coming-into-force.

When would TC start charging new fees?

TC expects to introduce new fee for Marine Insurance Certification Services in fiscal year 2020-21.