Terms of Reference, Working Group on New Accountability Framework in National Aircraft Certification

Canadian Aviation Regulation Advisory Council
(CARAC)
Part V –NATIONAL AIRCRAFT CERTIFICATION

TERMS OF REFERENCE

WORKING GROUP
ON
ACCOUNTABILITY FRAMEWORK IN NATIONAL AIRCRAFT CERTIFICATION

1. Background

Over the years, the National Aircraft Certification Branch has built a strong partnership with the Canadian aviation industry to effectively make use of Ministerial Delegation of Authority as specified in the Aeronautics Act. The development of our delegation framework originated in 1968 with “Notice to Aircraft Maintenance Engineers and Aircraft Owners N-AME-AO 45/68”, which introduced the Design Approval Representative (DAR) system. Based on recommendations of the Dubin Commission in 1980’s, the Aeronautics Act was amended in 1985 to provide for Authorization, by the Minister, of persons engaged in the field of Airworthiness. Airworthiness standards were then developed in Airworthiness Manual Chapter 505, and the DAR system was expanded to include two new categories of corporate delegate: the Airworthiness Engineering Organization (AEO); and the Design Approval Organization (DAO).

In light of the strategic direction of Transport Canada Civil Aviation (TCCA) as specified in Flight 2005 and Flight 2010, the need to review and enhance the delegation system currently in place in Subchapters B, C and E of Chapter 505 of the Airworthiness Manual (AWM) was identified. The current framework identified in Chapter 505 of the AWM confuses the roles and obligations, and weakens the accountabilities of applicants and holders of design approvals, the Minister, and delegates in the design approval process. The confusion in roles leads to the Minister often assuming certain obligations that should be assumed by the applicant or the holder.

The National Aircraft Certification Branch has taken steps to improve this through development of Part V Subpart 21 of the Canadian Aviation Regulations (CARs). This had been presented and accepted by the CARAC Part V(AC) Technical Committee as Notice of Proposed Amendment (NPA) 2004-107 (known as CAR 521), which more clearly delineates the roles and obligations of the applicant, the holder and the delegate. Clarification of the accountability framework is needed to help TCCA further improve CAR 521 which still places much emphasis on the obligations of the delegate and not enough on that of the applicant and the holder.

During the CARAC Technical Committee meetings where the NPA for CAR 521 was presented, industry supported the concept of recognizing a design organisation’s capability without necessarily granting an organizational delegation. Transport Canada took on the commitment to further investigate this concept and to continue the discussion, which led to the need for an enhanced accountability framework. In 2005, this preliminary concept was shared with TCCA staff and industry to receive feedback in the form of concerns and questions.

2. Purpose

Accountability implies an obligation that if unfulfilled, leads to some form of legal or punitive action.  All stakeholders within aviation industry have obligations including Canada having obligations as an ICAO contracting State, the Minister of Transport having obligations under the Aeronautics Act and the Canadian Aviation Regulations and, applicants and holders of design approvals having obligations under the Aeronautics Act and the Canadian Aviation Regulations.  Applicants have obligations to develop a safe and compliant design, show that their design is safe and compliant and carry out their test programs safely.  Holders have an obligation to maintain a safe and compliant design. Finally the Minister of Transport has an obligation to promote Aviation Safety. An Accountability Framework is effective and efficient when stakeholders have clear understanding of their roles and obligations and no confusion exists on WHO is accountable for WHAT.

The purpose of this Working Group (WG) is to make recommendations for an enhanced accountability framework that addresses the roles, responsibilities and accountability of applicants, holders, delegates and the Minister in the aeronautical product and appliance design approval and post-approval process. 
The enhanced accountability framework must be developed in support of the main objectives of the TCCA Flight 2010 strategic plan aimed at building strength on:

• Commitment from the aviation community to sustain a strong safety culture;
• Trust and Confidence of stakeholders in the civil Aviation Program;
• Alignment of expectations for Civil Aviation and stakeholders; and,
• Compliance with regulatory requirements.

Given the implementation of Safety Management System (SMS) is the foundation to Flight 2010, the enhanced accountability framework needs to align the TCCA Aircraft Certification Branch regulatory structure with other disciplines of TCCA by developing a means to recognize design organizations capabilities based on similar existing “operating” certificates such as an Air Operator Certificate (AOC), and an Approved Maintenance Organization (AMO).    Ultimately, all these “operating” certificates will fully integrated for SMS to provide an effective safety oversight

3. Scope

The scope of the WG is to:

1. examine issues identified with the proposed  enhanced Accountability Framework for Aeronautical Product Certification proposal as presented to industry in 2005, including the development of a  new Canadian Aviation Document (CAD) recognizing design organisation’s knowledge of the certification process and technical capability to design products that comply with the applicable airworthiness and environmental standards, in support of the eligibility requirements currently identified in CAR 521.;
2. make recommendations for the development of a regulatory framework that is compatible with SMS and supports implementation of the enhanced accountability framework proposal within CAR 521; and
3. Identify appropriate regulations, standards and guidance material required in support of the improved accountability framework (Note the WG is not tasked to generate but only to identify such material) 

The WG shall adhere to the following guiding principles set out for the accountability framework initiative:

1. All proposals should be consistent with the strategic direction outlined in Flight 2010 as National Aircraft Certification has an obligation to stay aligned with the strategic direction of the TCCA.
2. All proposals should be consistent with the principles of the accountability framework for the applicant, holder, delegate and Minister—as presented at the Part V – National Aircraft Certification CARAC Technical Committee meeting on 22nd June 2006—as clear accountabilities are the foundation of the strategic direction of the TCCA.

The scope of the WG is not to develop a Regulatory Impact Analysis Statement (RIAS), but to review and analyse identified issues and propose solutions to optimize the proposal before developing the regulatory amendment. However, the output of this WG could serve as a reference in the preparation of the RIAS, which is part of the normal rulemaking process.

4. Approach

The WG will provide their recommendations to the CARAC Part V (AC) Technical Committee in preparation for the development of Notices of Proposed Amendment (NPAs).

The recommendations should be presented in a common format addressing each area of study separately, including as a minimum a description of the issue, background, discussion and proposed recommendations.

The WG shall consider the following aspects in order to complete its tasks:

1. Rationale for Change
   
   Determine whether the delegation system introduced in Divisions J and K of CAR 521 can be modified to improve accountability and if so, what changes to the existing system would be required.
   
   
2. Transition Risks
   
   
   1. Identify potential unintended and adverse effects that could be introduced with the  enhanced accountability framework and ways to mitigate negative effects;
   2. Determine whether industry has sufficient qualified people available to meet the new requirements under the existing system or the enhanced Accountability Framework and if not, make recommendations to minimize the impact.
      
      
3. Accountability
   
   
   1. Identify whether and how an increased emphasis on accountability has the potential to negatively impact on the TCCA/Industry partnership and propose ways to mitigate the impacts.
   2. Identify the accountability relationship for the scenario of an Approved Design Organization (ADO)/Approved Design Individual (ADI) contracting another ADO/ADI for services and determine whether such subcontracting is problematic to industry.
      
      
4. Cost to industry
   
   
   1. Identify the elements that would influence the costs of transition and make proposals as to how these costs could be minimized.
   2. Identify whether additional resources would be required to fulfill applicant and holder obligations and what the nature and function of those resources would be.
   3. Determine what elements of the enhanced framework would impact the financial and resource costs of fulfilling holder obligations.
   4. Identify lessons learned, including advantages and disadvantages, from the implementation of the DOA system by the European Aviation Safety Agency (EASA) that must be considered in the proposed Canadian regulations to minimize negative impacts.
      
      
5. Effects on Commerce
   
   
   1. Identify and explain the elements of the enhanced framework that would impact on small operators and make recommendations to minimize any negative impact.
   2. Identify and explain the elements of the enhanced framework that would impact on Design Approval Representatives (DARs) and make recommendation to minimize any negative impact.
   3. Identify the elements of the enhanced framework that would impact on those with investment money, ideas and markets but without certification capabilities and make recommendations to minimize any negative impact
   4. Identify and explain the elements of the enhanced framework that would impact on competitiveness with other countries and make recommendations to minimize any such negative impacts.
   5. Determine whether new eligibility requirements for applicants and holders are likely to stifle innovation and if so, make recommendations to minimize any negative impact.
      
      
6. Harmonization with the USA (and other Bilateral Partners)
   
   
   1. Determine whether the enhanced framework would affect the international competitiveness of Canadian industry and make recommendations to minimize any negative impact.
   2. Identify whether it is necessary to harmonize titles and acronyms (e.g. ADO) of the enhanced accountability framework with those used by the FAA and other major bilateral partners in their delegation system.
      
      
7. Impact on TCCA Resources
   
   Determine any effect on the levels of service provided by TCCA as a result of implementing the enhanced accountability framework and make recommendations to minimize any negative impact.
   
   
8. TCCA’s implementing challenges
   
   Determine if and how the enhanced accountability framework could affect national standardization of program delivery and make recommendations to minimize any negative impact.
   
   
9. ADO/ADI Requirements
   
   
   1. Determine the advantages and disadvantages of requiring an ADO to have an ordinary place of business in Canada, and an ADI to be a Canadian citizen or a permanent resident as defined in the Immigration Act and have an ordinary place of business in Canada.
   2. Determine the advantages and disadvantages of requiring an ADO/ADI to also be a CAR Standard 561 manufacturing certificate approval holder.
   3. Determine if anything should preclude an Approval Maintenance Organization (AMO) from becoming an ADO, and whether an AMO would find this beneficial.
   4. Determine the minimum number of persons required of an organization to become an ADO.
   5. Propose the minimum knowledge and technical capability required of an ADO or ADI and how this could be assessed.
   6. Identify what requirements need to be considered in the determination of what constitutes an acceptable design assurance system.
      
      
10. Independent Checking of Compliance Function and the Compliance Verification Engineers (CVE)
    
    
    1. Determine level of independence required for an independent check and propose conditions that could be specified to ensure this independence.
    2. Determine the eligibility criteria that must be met before a person can be eligible to be a CVE.
    3. Determine if anything should preclude a CVE from being someone who is not an employee of the ADO.
       
       
11. Use of Agents (Undertakings by other persons) by applicant and holders of certificates and approvals
    
    
    1. Determine whether TCCA should permit the use of agents. If so, identify what controls and requirements TCCA should place on these arrangements.
    2. Identify what substantiating data a design approval holder should be required to retain and what their agents may retain as proprietary.
       
       
12. Scope of Authority (also referred to as Level of Delegation, Scope, or Privileges)
    
    
    1. Review the impact on existing delegates scope of authorization and propose solutions to limit the reductions.
    2. Propose how the Scope of Authority should be defined.
    3. Determine if and how TCCA should differentiate eligible scopes for ADO from ADI.
       
       
13. “Catch-22” for design approval applicants who are not yet a holder of any other design approval.
    
    Determine methods for alleviating the “catch-22” situation where new design approval applicants may not meet the eligibility requirements because they have not yet demonstrated knowledge, technical capability and design assurance as a result of never having been through the process before.
    
    
14. Use of Subcontractors by ADO/ADI.
    
    
    1. Determine the benefits and the potential negative impact of allowing foreign subcontractors to work for and ADO/ADI.
    2. Determine if and how credit should be given for subcontractors who are Industry Standards Organization (ISO) accredited (for example).
    3. Determine if subcontractors also need to be an ADO/ADI.
       
       
15. Retroactive Application of Enhanced Accountability Requirements on Existing (i.e. Legacy) Design Approval Holders
    
    Identify the negative impacts if TCCA were to retroactively apply the new eligibility and holder requirements to existing holders and make recommendations to minimize these impacts.
    
    
16. Declarations of Compliance
    
    
    1. Determine who should be required to make the declaration of compliance.
    2. Propose suggested format(s) for the declaration of compliance.
    3. Determine who should make a declaration of compliance when an ADO/ADI subcontracts to another ADO/ADI.
       
       
17. The “New” Delegate
    
    
    1. Confirm need for delegates in the enhanced framework.
    2. Propose criteria that will be used for selecting delegates.
    3. Specify what activities delegates will perform.
    4. Determine the authorization that delegates will be eligible to receive.
    5. Determine if an ADI could also be a “New” Delegate.
       
       
18. Authorized Persons (AP)
    
    Determine if the elimination of Authorized Persons would have negative motivating influence for industry personnel and if so, make recommendations to minimize these impacts.

5. Working Group

Working Group Title: “Accountability Framework in National Aircraft Certification”
Working Group Leader

Les Aldeers	Air Transport Association of Canada - ATAC (co-chair)
Gilles Morin	Transport Canada, National Aircraft Certification, Regulatory Standards (co-chair)

Working Group Members:

Mike Deer	Bell Helicopter Textron Canada Limited - BHTC
John Carr	Aircraft Electronics Association - AEA
Brian Jenner	Helicopter Association of Canada- HAC
Bob Neis	Northern Air Transport Association - NATA
Doug Peters	Aero Consulting Services - ACS
Francois Tanguay	L-3 Communications MAS (Canada) Inc.
William W. Morton	VanDAR (DAR)
Perry Stamatiou	Bombardier
Peter Boyd	Pratt & Whitney
Bob Mather	Aerospace Industries Association of Canada - AIAC
Rob Meath	Air Canada
Alex Markov	Amtech
Micheal Vautour	Canadian Federation AME association
Dick Hovey	Association of Independent Delegates for National Aircraft Certification -AIDAC (DAR)
Roop Dhaliwal	Transport Canada, National Aircraft Certification- Engineering
Derek Ferguson	Transport Canada, Aircraft Certification - Delegations & Quality
Kevin Bruce	Transport Canada, National Aircraft Certification – Regional Representative
Martin Thieringer	Transport Canada, National Aircraft Certification, Regulatory standards, Manager, Policies and Procedures Regulatory Standards
TBD	Transport Canada, National Aircraft Certification, Continuing Airworthiness
Brian Whitehead	Transport Canada, Maintenance and Manufacturing
Scott Geddie	Federal Aviation Administration- FAA

Working Group Technical Advisors: These are persons whose role is to support the WG members in their role within the WG.

In accordance with the CARAC Management Charter and Procedures, members of the Part V (National Aircraft Certification) Technical Committee have selected the Working Group membership including representation from both Transport Canada and industry. Every effort has been made to balance the Working Group membership between Transport Canada and industry participation.

The Working Group will strive to achieve consensus. However, if consensus is not achievable, the dissenting opinions will be recorded by the WG for review by the Technical Committee. The conduct of the Working Group meetings, the keeping of minutes and the tracking for disposition of the individual issues will be in accordance with the CARAC Management Charter and Procedures.

6. Reporting

The Working Group members are responsible to report all agreements reached unresolved issues and planned actions to their respective organizations. The Part V (National Aircraft Certification) Technical Committee will be the forum where the Working Group leader will provide status updates on the activities of the Working Group and where the final recommendations of the Working Group will be reviewed.

The Working Group leader is responsible to report to the Part V (National Aircraft Certification) Technical Committee and is responsible for submitting reports to the Technical Committee Chair regarding progress made, decisions reached, updates on schedules and issues that remain unresolved. The Working Group will report specific recommendations, the rationale upon which those recommendations are based and details of any dissenting points of view.

The Working Group leader is responsible to keep the CARAC Secretariat apprised of the progress of the Working Group so that it may publish relevant information to the CARAC members as required.

7. Technical Committee

The Part V (AC) Technical Committee has the authority to accept, reject or send issues back to the Working Group for further study. Upon reviewing the Final Report of the Working Group, the Technical Committee may decide to provide additional recommendations to the Civil Aviation Regulatory Committee (CARC). To do so, the Technical Committee may append its own comments to the working group recommendations, ensuring not to revise the WG recommendations since they are the product of expertise that only resides among the working group membership.

8. Timing

It is expected that the Working Group activities will span over a maximum of six months. The Working Group members will define their work schedule accordingly,  with the objective of submitting a final report to the CARAC Part V (AC) technical committee by the end of January 2007. 

9. Budget

Costs incurred for the Working Group members travel, accommodations, meals and incidental expenses shall be borne by their respective organizations.

10. Administrative support

The National Aircraft Certification branch will be responsible for providing meeting facilities and secretarial functions in addition to all necessary administrative support.
         
Approved by:

Original signed by	August 29, 2006
_________________________	________________
Martin J. Eley Executive Director & Co-Chair National Aircraft Certification Technical Committee (Part V)	Date
Original signed by	August 29, 2006
_________________________	________________
D. Burns Industry Co-Chair (Bombardier Aerospace) Aircraft Certification Technical Committee (Part V)	Date