Canadian Underwriter
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Fuelling Improved Reporting


September 2, 2016   by Alan Harvie, Senior Partner, Norton Rose Fulbright Canada LLP


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Recent amendments to Canada’s federal Transportation of Dangerous Goods Regulations have introduced new reporting requirements for incidents involving dangerous goods.

NEW DEMANDS AIMED AT ENHANCING TDG INFORMATION

Emergency reports

First, a person who has charge, management or control of dangerous goods that are released must immediately file an emergency report with local authorities and the Canadian Transport Emergency Centre (CANUTEC), operated by Transport Canada.

The new emergency report must be submitted to any local authority responsible for responding to emergencies in the area. It must include the name and contact information of the person making the report, the date, time and location of the incident, the mode of transportation, the shipping name or United Nations (UN) number of the dangerous goods, the quantity of the dangerous goods being carried, the estimated quantity released and a description of the incident.

New reporting thresholds

The thresholds for reporting have also changed.

First, a report must now be made for the release of any quantity of the dangerous goods, except for flammable liquids or solids in Packing Group III, where releases of less than 30 litres or 30 kilograms do not have to be reported. Previously, the reporting threshold was 200 litres for flammable liquids or solids in Packing Group III.

Alan Harvie, Senior Partner, Norton Rose Fulbright Canada LLP

Alan Harvie, Senior Partner, Norton Rose Fulbright Canada LLP

The released dangerous goods do not have to have caused any adverse effect to be reportable. A report must also be made if the integrity of a means of containment is compromised or if the centre sill or stub sill of a tank car is cracked by at least 15 centimetres.

Second, additional reporting is also now required and must be made to the consignor of the goods and to CANUTEC if anyone is injured, killed, evacuated or has to be sheltered in a place or in a building, or if a road, main railway line or main waterway is closed as a result of a release or anticipated release of dangerous goods in transit.

Third, if certain dangerous goods felt to have a potential security threat are lost, stolen, involved in a collision or unlawfully interfered with while in transit, a report must be made as soon as possible to CANUTEC.

For instance, the theft of a chlorine cylinder from a truck will have to be reported. If the dangerous goods are explosives, the incident must be reported to Natural Resources Canada, and if radioactive materials, to the Canadian Nuclear Safety Commission.

Finally, the person with charge, management or control of dangerous goods being imported, offered for transport, handled or transported must report to CANUTEC any incidents involving unlawful interference (that is, tampering) with any dangerous goods being transported as soon as such interference is discovered.

Follow-up requirements

A follow-up report must also be made to CANUTEC within 30 days of any incident if, as a result of the incident, anyone is killed, requires emergency medical treatment by a healthcare provider, is evacuated or has to be sheltered in a place or in a building, or if a road, main railway line or main waterway is closed.

The information to be included in the 30-day, follow-up report is set out in the amendments and includes the location of the incident, the type of incident, the type of goods, the exact quantity released, the type of container or packaging involved and how it was damaged or destroyed, an estimate of the cost of the goods lost and any financial loss incurred by anyone as a result of the incident and any response or related remediation costs.

These new reporting requirements are in addition to other federal and provincial reporting requirements in Canada.

The amendments are designed to improve the quality of information received by Transport Canada, increase harmonization with reporting practices in the United States and improve local emergency responses to incidents involving dangerous goods.

The amendments further expand the definition of a “release” to encompass more types of incidents, including voluntary releases and anticipated releases. Previously, only accidental releases were considered a release.

NEED FOR CHANGE

Several factors drove the changes to the reporting requirements.

Previously, security issues were not addressed in the legislation and Transport Canada has now decided it needs to know about the theft, loss of or tampering with certain dangerous goods.

In 2010, a Transport Canada internal audit and the Transportation Safety Board of Canada both recommended the federal department improve its data collection processes to increase its risk analysis capacity and ability to establish more effective regulations in future.

The new reporting requirements are expected to provide Transport Canada with more and better information about incidents involving dangerous goods, especially with respect to the means of containment or packaging used to transport dangerous goods.

Historically, the only factor needed to determine if a report was required was the quantity of the dangerous goods released during transport.

As a result, some incidents that affected the public were not reported because the volumes released did not reach the reporting thresholds. Now, for most dangerous goods, the release of any amount of the dangerous goods is reportable.

Previously there was no standardized format for reporting, and reports differed in their level of detail. Transport Canada is reported to have had to commonly undertake time-consuming follow-up inquiries to obtain the information needed for its data analysis.

The new amendments prescribe the information that must be included in the report.

Finally, releases of dangerous goods during road transport did not need to be reported to CANUTEC. The amendments, however, now require reporting for road incidents.

INSURANCE IMPLICATIONS

Although the new requirements do not introduce any new obligation for transporters of dangerous goods to report incidents to their respective insurance companies, the new requirements may be of interest to the insurance industry in two ways.

First, adjusters may be interested in the information in a 30-day, follow-up report made by the transporter to CANUTEC and local authorities with respect to the cause of the incident, the volume of goods lost or damaged and the economic and other impacts of the incident on people, property and the environment.

Although Transport Canada has advised that it will treat all 30-day, follow-up reports as confidential unless disclosure is required under the Access to Information Act, the Privacy Act or otherwise by law, presumably an adjuster could demand a copy of the report from the insured.

Under both the Access to Information Act and the Privacy Act, it should be possible to obtain much of the information in the report provided the person filing the report does not object to the disclosure.

Second, it may be possible for underwriters to access the information about dangerous goods incidents that will be collected by Transport Canada for conducting risk analysis on the transportation of dangerous goods.

Both the quality and quantity of the information that Transport Canada collects under the new requirements is expected to increase. This will potentially allow the insurance industry access to a larger and better set of statistical information in the future to assess risks associated with the transportation of dangerous goods.

A six-month transition period is in place to adapt to the new obligations. As such, until December 1, 2016, carriers can comply with either the old or new reporting requirements.

After December 1, persons required to report releases or anticipated releases of dangerous goods or otherwise make a report under the federal amendments will need to follow the new reporting obligations.

—Alan Harvie, Senior Partner, Norton Rose Fulbright Canada LLP


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