Originally proposed in late 2013, the Trans Mountain Pipeline Expansion Project (the TMX or the Project) has faced numerous legal and regulatory challenges and delays. However, two important judgments delivered in early 2020 appear to have settled much of the uncertainty surrounding the future of the Project.
While the ultimate result was expected, the speed with which the Court announced its decision was extraordinary. The comments and questions from certain Supreme Court Justices during the hearing, particularly those of Justices Rowe and Brown, made it clear that federal jurisdiction over interprovincial undertakings remains an unimpeachable core federal power and provinces cannot interfere in their operation.
On January 16, 2020, the Supreme Court of Canada deliberated for only thirty minutes before dismissing British Columbia's unconstitutional attempt to legislate the flow of heavy oil through the TMX. British Columbia's appeal was the culmination of its government's efforts to fulfill its May 2017 election promise to "use every tool in the toolbox" to stop the Project.
In April 2018, the Government of British Columbia submitted three reference questions to the Court of Appeal of British Columbia (the Reference). The Reference asked whether British Columbia had jurisdiction to amend its Environmental Management Act to impose a permitting requirement on the transportation of "heavy oil" within British Columbia (the Proposed Amendments). The Proposed Amendments defined "heavy oil" to only capture blends of +666oil produced in Alberta and Saskatchewan and, due to the infrastructure currently in place, would only apply to the TMX and additional crude-by-rail operations.
The British Columbia Court of Appeal unanimously rejected the Proposed Amendments in May 2019, finding that the Province did not have the jurisdiction to enact them as they impermissibly intruded on the federal government's constitutional jurisdiction over interprovincial works and undertakings, which include interprovincial pipelines and railroads. British Columbia appealed to the Supreme Court of Canada.
On January 16, 2020, the Supreme Court of Canada, citing only the reasons of the British Columbia Court of Appeal, unanimously dismissed British Columbia's appeal. While the ultimate result was expected, the speed with which the Court announced its decision was extraordinary.
The comments and questions from certain Supreme Court Justices during the hearing, particularly those of Justices Rowe and Brown, made it clear that federal jurisdiction over interprovincial undertakings remains an unimpeachable core federal power and provinces cannot interfere in their operation.
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