3. Regulatory Issues: comments and response

Stevenson Equipment Limited:

Response:

The proposed Regulations set out technical standards respecting exhaust, crankcase and smoke emissions. The proposed Regulations establish emission standards and test procedures aligned with those of the U.S. EPA. While the overall objectives of the proposed Regulations are similar, the laws of both countries differ. Canadian legislation does not authorize the discretion allowed to the U.S. EPA administrator.

The proposed Regulations are structured such that U.S. EPA certificates of conformity are accepted whether or not the EPA administrator has exercised discretion and whether or not alternative standards are applied.

In the case of engines that are not certified by the EPA, a manufacturer or importer may produce evidence of conformity in a form and manner that is satisfactory to the Minister, which normally means the same evidence as would be provided to obtain an EPA certificate.

Stevenson Equipment Ltd. submitted comments seeking clarification on the national emissions mark

Response:

Companies are responsible for ensuring that their products comply with the proposed Regulations. Section 152 of CEPA 1999 prohibits a company from transporting prescribed engines between provinces or territories unless the engine has a national emissions mark applied to it. Subsection 153(1) of CEPA 1999 requires engines to conform to the requirements of the proposed Regulations as a condition of use of the mark. 153(1) also directly requires conformity as a condition of importation, such that the national emissions mark is not essential for imported engines. The proposed Regulations, therefore, exclude imported engines from requiring a national emissions mark.

Information that could satisfy the requirement of subsection 6(2)(d) of the discussion draft (also subsection 6(2)(d) of the proposed Regulations) to show that a company is capable of verifying compliance with the standards could include (refer to Guidance Document: Off-Road Small Spark-Ignition Engine Emission Regulations):

  1. Recent experience in obtaining U.S. EPA emission certification for engines that would be covered under the proposed Off-Road Compression Ignition Engine Emission Regulations; or
  2. Technical information to show that it is capable of verifying compliance with the standards set out in the proposed Regulations including, but not limited to, information describing the capabilities of the emission test facilities operated by, or on behalf of, the company to produce evidence that its engines conform to the standards set out in the Regulations. This may include evidence that the emission test facility used on behalf of the company has produced test results used in support of a successful application to the EPA for the issuance of a certificate of conformity.

Response:

Section 8(1) of the discussion draft (section 9(1) of the proposed Regulations) is designed to reflect U.S. EPA standards (section 106, subpart B, part 89 of the Code of Federal Regulations).

Section 8(1) of the discussion draft includes a restriction on design parameters of an emission control system. Environment Canada believes it is important that the proposed Regulations include a design restriction on emission control systems. It is not Environment Canada's intention to prevent the use of emission control systems that are expected to be used to meet emission standards in the U.S.

Response:

The proposed Regulations are in accord with the comment.

The replacement engine provision in section 11 of the discussion draft (section 12 of the proposed Regulations) was modified to make it clearer. Also, subsection 12(3) has been added, requiring a label on a replacement engine to facilitate the administration of the Regulations. This can be either a bilingual label identifying the engine as a replacement engine or the replacement engine label set out by the U.S. EPA in section 1003(b)(7), Subpart K, part 89 of the Code of Federal Regulations.

Response:

The proposed Regulations are in accord with the comment.

The transition engine provisions in section 12 of the discussion draft (section 13 of the proposed Regulations) were modified. The definition of a transition engine has been expanded to correspond to the flexibility provisions set out by the U.S. EPA for machine manufacturers under section 102(d), subpart B, part 89 of the Code of Federal Regulations. Additionally, subsection 13(5) has been added to enable a company to import transition engines for installation into machines that would qualify.

Eligible periods for transition engines have been modified to align with the U.S. standards.

To facilitate administration of the proposed Regulations, labeling requirements for transition engines have been maintained. Labeling requirements have been broadened, in recognition of current voluntary industry practice to label flexibility engines (named transition engine in Canada) in the U.S.

Response:

These issues are a commercial matter between engine manufacturers and distributors. The requirements of the proposed Regulations regarding documents required to demonstrate conformity with the regulatory standards were not modified. However, Environment Canada is willing to revisit this matter if evidence is brought forward that the proposed Regulations may have a significant negative impact on the normal course of business for distributors.

Companies are responsible for ensuring that engines they import comply with the proposed Regulations and for providing such evidence of conformity upon request by the Minister. The proposed Regulations enable a company to provide evidence of conformity in the form of a valid U.S. EPA certificate of conformity and demonstration of concurrent sale in the U.S. (section 16 of the proposed Regulations). Evidence of conformity can also be provided in a form and manner satisfactory to the Minister (section 17 of the proposed Regulations).

The Minister can request evidence of conformity for engines subject to the proposed Regulations for a period of up to 8 years following their manufacture. This period corresponds to the record retention time frame under the current EPA standards.

Response:

The engine identification labels are intended to facilitate the administration of the proposed Regulations. Engines covered by an EPA certificate of conformity are required to be identified with the U.S. EPA engine information label. Replacement (section 12 of the proposed Regulations) and transition engines (section 13), require appropriate labeling.

With regard to label durability, it is the practical expectation of Environment Canada that a label remain affixed to the engine. Environment Canada intends to address any instances of "missing" labels on a case by case basis.

Response:

The importation documentation requirements are similar to those under the Off-Road Small-Spark-Ignition Engine Emission Regulations and reflect information that should be readily available on documents already being submitted to the Canada Border Service Agency (previously called Canada Customs and Revenue Agency). This should reduce the administrative burden on both importers and the government by eliminating the need to create and submit additional forms. To assist with the transition, the Department plans to prepare a guidance document to assist importers with regard to importation requirements as they relate to these Regulations (refer to Guidance Document: Off-Road Small Spark-Ignition Engine Emission Regulations).

Response:

While Environment Canada intends to administer notice of defect requests in a manner compatible with U.S. practice, the Canadian legislation is different and the regulations will not align exactly.

Section 157 of CEPA 1999 outlines the obligations of a company on "becoming aware of a defect in the design, construction or functioning of the engine that affects or is likely to affect its compliance with the prescribed standard". This includes an initial notice and follow-up reports for a period of two years unless the Minister directs otherwise. Environment Canada expects to be given a report similar to that described by the EPA under subsection 85.1903 of the CFR.

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2022-10-14