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5. Canada Port Authorities Land Transactions Procedures and Time Frames

Canada Port Authorities Land Transactions Procedures and Time Frames

Purpose

This paper sets out the procedures, the information and the approximate time frame required for Transport Canada to process real property transactions at the request of Canada Port Authorities (CPAs).

Format

The various transactions are set out according to the nature of the property involved. Part I sets out the procedures, information and time frames required for transactions involving federal real property. Part II sets out those for transactions involving real property other than federal real property.

Part I
Transactions Involving Federal Real Property

• Sale of Federal Real Property;
• Exchange of Federal Real Property for Other Property of Comparable Market Value;
• Acquisition of Real Property to be Held as Schedule "B" Federal Real Property;
• Management of Real Property Leased by or Licenced to Her Majesty from a Third Party [Note - this section is under development and will be forwarded under separate cover];
• Notification of Federal Real Property no Longer Required for Port Purposes;
• Minister's Consent to Increase Authorized Term of a Lease or Licence of Federal Real Property; and
• Minister's Consent to Lease or Licence Federal Real Property at Less than Fair Market Value.

• Annex A - Raising Title of Ungranted Crown Lands in British Columbia

Part II
Transactions Involving Real Property
Other than Federal Real Property

• Sale or Exchange of Real Property Other than Federal Real Property;
• Acquisition of Real Property to be Held as Property Other than Federal Real Property;
• Lease or Licence of Real Property from a Third Party (leasing-in);
• Minister's Consent to Increase Authorized Term of a Lease or Licence of Property Other than Federal Real Property (Toronto and Hamilton only); and
• Minister's Consent to the Lease or Licence of Real Property Other than Federal Real Property at Less than Fair Market Value (Toronto and Hamilton only).

General Issues

Timing, Registration and Publication of Supplementary Letters Patent

Subsection 44(6) of the Canada Marine Act (CMA) provides that a CPA may manage, occupy or hold only the real property set out in its letters patent. Consequently, supplementary letters patent must be approved by the Minister prior to the closing of the real property transaction to ensure that the letters patent continually reflect the real property managed, occupied or held by the CPA.

It is recommended, therefore, that CPAs submit a request for supplementary letters patent with sufficient time allowed for the request to be reviewed prior to the expected closing of the transaction. If the Minister is satisfied that the proposed amendment is consistent with the CMA, supplementary letters patent would be issued conditional upon the completion of the transaction. In the case of an exchange, for example, the supplementary letters patent would indicate that the amendment is effective upon the provincial registration of the exchange documentation. We ask, therefore, that CPAs provide Airport and Port Programs with a copy of the registered instrument at the earliest opportunity for deposit in the Transport Canada Legal Registry with the original supplementary letters patent. Copies of the supplementary letters patent indicating the registry number will be forwarded to the CPA.

Transport Canada will arrange to have the supplementary letters patent published in the Canada Gazette in accordance with subsection 8(3) of the CMA and will inform the CPA of the anticipated publication date.

Resolutions of Board of Directors

The CMA specifically requires that requests initiated by the CPA for supplementary letters patent be made by the board of directors. Subsection 9(1) of the CMA provides that the Minister may "...at the request of the board of directors, issue supplementary letters patent...." Consequently, an original certified copy of the resolution of the board of directors is required setting out the request for supplementary letters patent. The resolution must be sufficient to constitute a request under subsection 9(1) and, therefore, must clearly identify the transaction, the real property involved and the required amendment to the letters patent. If the resolution merely refers to an internal CPA submission document, that document or relevant portion thereof must be provided to link the resolution to the specific transaction and the property involved.

Transport Canada would be pleased to provide draft resolutions by way of example. Note that, where the Minister initiates the supplementary letters patent process under subsection 9 (1), a resolution of the board of directors would not be required.

First Nations

In the 1997 decision of Delgamuukw v. British Columbia, the Supreme Court of Canada made general pronouncements on the scope and content of Aboriginal title. As a result, Transport Canada is required to consult with the Department of Justice to assess the possible existence of aboriginal title prior to the disposal of federal real property.

Transport Canada will consult with the Department of Justice and Indian and Northern Affairs Canada and gather preliminary information. The level of probability of a legitimate claim of Aboriginal rights or title is assessed. This assessment determines whether or not the transaction can proceed or whether further steps, including consultation with Aboriginal groups, are required. Transport Canada and the Department of Justice will make the determination, and keep the CPA apprised.

Treasury Board

It should also be noted that Treasury Board does not hold regular hearings during the summer months and you may wish to organize your real property transactions accordingly.

Canada Port Authority Environmental Assessment Regulations

Pursuant to the Canada Port Authority Environmental Assessment Regulations (CPAEAR), CPAs are required to maintain a public registry of environmental assessments. Where a transaction involves a project within the meaning of the Canadian Environmental Assessment Act (CEAA) and the CPAEAR, CPAs should provide Transport Canada with the registry reference number of the environmental assessment.

Part I
Transactions Involving Federal Real Property

Sale of Federal Real Property

A CPA does not have the authority to sell federal real property which it manages. Under the CMA and Federal Real Property Act (FRPA), the sale of federal real property must be authorized by the Governor in Council, on the recommendation of Treasury Board. The sale would be on such terms and subject to such conditions and restrictions as the Governor in Council considers advisable.

If the sale is approved, supplementary letters patent would be required to amend Schedule B of the letters patent by deleting the federal real property. The Minister may issue supplementary letters patent if he is satisfied that such an amendment is consistent with the CMA.

1.  Procedure and Time Frame

Scenario I

Sale to CPA at Nominal Value/Retention of Proceeds
of Sale by CPA

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister:

1. seek authorization to sell the subject federal real property to the CPA for nominal value to enable the CPA to sell the property to a third party and retain the proceeds of the sale; and
2. issue supplementary letters patent to amend the Letters Patent by:

1. deleting the subject federal real property from Schedule B;
2. adding the subject property to Schedule C as other real property; and
3. deleting the subject property from Schedule C upon transfer to the third party.

The CPA should send the resolution with a supporting letter from the Chief Executive Officer (CEO) to the Director General, Airport and Port Programs.

Scenario II

Sale to CPA at Fair Market Value

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister:

1. seek authorization to sell the subject federal real property to the CPA at fair market value; and
2. issue supplementary letters patent to amend the Letters Patent by:

1. deleting the subject federal real property from Schedule B; and
2. adding the subject property to Schedule C as other real property.

The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

Scenario III

Sale to Third Party at Fair Market Value

To initiate ocess, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister:

1. seek authorization to sell the subject federal real property to a third party at fair market value; and
2. issue supplementary letters patent to amend the Letters Patent by deleting the subject federal real property from Schedule B.

The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

In all three scenarios, the supporting letter from the CEO which accompanies the resolution should set out sufficient details of the proposed transaction to enable Transport Canada to brief the Minister and prepare a Treasury Board submission. The letter should include, as a minimum:

1. full disclosure of the details of the proposed sale, including:
   1. the name of the proposed transferee;
   2. legal description, opinion on title and survey, as applicable;
   3. copy of fair market value appraisals (see Note (1) below);
   4. expected closing date or other time constraints; and
   5. any conditions or restrictions upon the sale or on title;
2. the rationale for the sale of the federal real property;
3. if seeking proceeds under Scenario I:
   1. the rationale for the port to retain the proceeds of sale, e.g. re-investment in a specific port project or operation;
   2. the CPA's intended use of the funds;
   3. details of port monies spent on the property, including initial acquisition price or improvements;
4. whether or not the proposed sale is consistent with the CPA's land-use plan;
5. environment (see Note (1) below):
   1. confirmation of whether or not the sale is for the purpose of a project within the meaning of the CEAA and, if yes, copy of the screening report; and
   2. confirmation that the environmental condition has been ascertained and that the lands are or can be made suitable for the intended use and copy of the environmental site assessments;
6. an assessment of the impact of the proposed sale on the CPA in terms of port development and/or operations;
7. an indication of the implications for the CPA if the transaction does not proceed; and
8. details of any economic, political or social implications concerning the proposed sale. The CPA should advise of the results of public consultations and any public concerns raised.

Note (1) - Appraisals and Environmental Assessments

The sale of federal real property will be carried out by Public Works and Government Services Canada (PWGSC). PWGSC will require appraisal and environmental information sufficient to satisfy Treasury Board policy. Pursuant to the Treasury Board Common Services Policy, PWGSC has sole authority for appraisals used for conveyances of federal real property.

There are two options:

1. the CPA carries out, or causes to be carried out, an appraisal and/or environmental assessment and submits the information to Transport Canada. Transport Canada provides the information to PWGSC. PWGSC may accept the information, seek further information or clarification from the CPA, or conduct such further and other studies as it sees fit; or
2. the CPA may request that Transport Canada contract with PWGSC to conduct the appraisal and/or the environmental assessment work directly.

Whether or not PWGSC is reviewing the CPA's reports or is carrying out the work directly, the process will be more efficient and expedient if Transport Canada and PWGSC are involved in transactions involving federal real property at the early stages.

Note (2) - British Columbia CPAs

If the subject property is ungranted federal real property, additional information would be required to enable Transport Canada to seek Governor in Council authorization to raise title. Please refer to Annex A entitled "Raising Title".

Note (3)

The supplementary letters patent would be effective on the dates of registration of the sale documents. As soon as possible upon completion of the transactions, therefore, the CPA shall provide Transport Canada with a copy of the registered documents or a title certificate from the registrar indicating the date of registration. This will be deposited with the original supplementary letters patent in the Transport Canada Legal Registry to document the effective date of the amendment to the letters patent.

Exchange of Federal Real Property for Other Property of Comparable Market Value

A CPA has the authority to exchange federal real property for other real property of comparable market value subject to the issuance of supplementary letters patent to describe the real property being acquired as federal real property. The Minister may issue supplementary letters patent if the Minister is satisfied that the amendment is consistent with the CMA.

As a general rule, for the purposes of subparagraph 46(1)(b)(i) of the CMA, Transport Canada will consider federal real property to be of comparable market value to other real property if the difference in the appraised fair market values of the properties is not greater than fifteen percent (15%). Note, however, that if the fair market values of the properties are not comparable within the meaning of subparagraph 46(1)(b)(i), the transaction must be processed as an acquisition and a sale (see Sections A and C respectively for information on sales and acquisitions).

1.  Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister issue supplementary letters patent to reflect the exchange. The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should set out sufficient details of the proposed exchange to establish that it is within the authorities of the CMA and to enable Transport Canada to brief the Minister. The letter should include, as a minimum:

1. details of the proposed exchange transaction;
2. the appraised fair market value of the properties (see Note (1) below);
3. the expected closing date or other time constraints;
4. the justification for the exchange;
5. the impact of the exchange of the federal real property on the CPA in terms of port development and/or operations;
6. an indication of the implications for the CPA if the transaction does not proceed;
7. confirmation that the other real property is of comparable market value to the federal real property being exchanged;
8. whether or not the proposed exchange is consistent with the CPA's land-use plan;
9. legal description, opinion on title and survey, as applicable;
10. environment (see Note (1) below):
    1. confirmation of whether or not the exchange is for the purpose of a project within the meaning of the Canadian Environmental Assessment Act (CEAA) and, if yes, copy of the screening report; and
    2. confirmation that the environmental condition has been ascertained and that the lands are or can be made suitable for the intended use and copy of the environmental site assessments; and
11. details of any economic, political or social implications concerning the proposed exchange. The CPA should advise of the results of public consultations and any public concerns raised.

Note (1) - Appraisals and Environmental Assessments

1. Appraisal - A CPA may provide Transport Canada with the appraised fair market values of the properties to be exchanged or the CPA may request that Transport Canada contract with PWGSC to conduct an appraisal.
2. Environmental Assessments - A CPA may:

1. carry out, or cause to be carried out, an environmental assessment and submit the information to Transport Canada [Transport Canada may accept the information, seek further information or clarification from the CPA, or conduct such further and other studies as it sees fit]; or
2. request that Transport Canada contract with PWGSC to conduct the environmental assessment work directly.

Whether or not Transport Canada or PWGSC are reviewing the CPA's reports or are carrying out the work directly, the process will be more efficient and expedient if Transport Canada and PWGSC are involved in transactions involving federal real property at the early stages.

Note (2) - British Columbia CPAs

If subject property is ungranted federal real property, additional information would be required to enable Transport Canada to seek Governor in Council authorization to raise title. Please refer to Annex A entitled "Raising Title".

Note (3) - Documentation

A CPA may prepare, execute, deliver and register documents to effect the exchange. Provincial conveyancing documentation may be used.

The documentation transferring the federal real property to the other party may have the following signature block:

"

---------------------------------
Minister of Transport
by the *** Port Authority
pursuant to subsection 46(1.1) of the Canada Marine Act "

The other party should direct title to:

"Her Majesty the Queen in right of Canada, as represented by the Minister of Transport."

The supplementary letters patent would be effective on the later of the dates of registration of the exchange documents. As soon as possible upon completion of the transactions, therefore, the CPA shall provide Transport Canada with a copy of the registered documents or a title certificate from the registrar indicating the date of registration. This will be deposited with the original supplementary letters patent in the Transport Canada Legal Registry to document the effective date of the amendment to the letters patent.

Acquisition of Real Property to be Held as Schedule "B" Federal Real Property

Neither the CMA nor the letters patent authorize the CPAs to acquire property to be held as federal real property. Any property to be held as Schedule B federal real property must be acquired by Her Majesty. Pursuant to the Federal Real Property Regulations (FRPR), the Minister of Transport may acquire property of a maximum value of $250,000 without Treasury Board approval (Scenario I). The Minister will require Treasury Board approval should the fair market value of the property exceed $250,000 or if the terms of the acquisition are outside the Treasury Board Real Property Policies(Scenario II). In certain cases, Transport Canada may enter into an agreement with the CPA to undertake, on Her Majesty's behalf, certain tasks related to the completion of the acquisition.

At the time of acquisition, the property would be placed under the CPA's management by the issuance of supplementary letters patent. The Minister may issue supplementary letters patent if the Minister is satisfied that the amendment is consistent with the CMA.

1.  Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister:

1. acquire the subject property; and
2. issue supplementary letters patent to amend Schedule B of the Letters Patent to include the subject property.

The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

Scenario I

Fair market value of the land to be acquired is under $250,000:

Scenario II

Fair market value of the land to be acquired is over $250,000:

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should set out sufficient details of the proposed acquisition to enable Transport Canada to brief the Minister. The letter should include, as a minimum:

1. full disclosure of the details of the proposed acquisition, including:
   1. the name of the vendor;
   2. the intended use;
   3. legal description, opinion on title and survey, as applicable;
   4. copy of fair market value appraisals (see Note (1) below);
   5. expected closing date or other time constraints; and
   6. any conditions or restrictions upon the purchase or on title;
2. an indication of why the CPA wishes the property to be held as federal real property;
3. the rationale for the acquisition in terms of port development and/or operations, including the intended use;
4. confirmation that the proposed acquisition is consistent with the CPA's land-use plan;
5. an indication of the implications for the CPA if the transaction does not proceed;
6. environment (see Note (1) below):
   1. confirmation of whether or not the acquisition is for the purpose of a project within the meaning of the CEAA and, if yes, confirmation that the CPA is in compliance with the CPAEAR with respect to that project and indication of CPAEAR public registry reference number; and
   2. confirmation that the environmental condition has been ascertained and that the lands are or can be made suitable for the intended use and copy of the environmental site assessments; and
7. details of any economic, political or social implications concerning the proposed acquisition. The CPA should advise of the results of public consultations and any public concerns raised.

Note (1) - Appraisals and Environmental Assessments

Appraisal and environmental information must satisfy Treasury Board policy. Pursuant to the Treasury Board Common Services Policy, PWGSC has sole authority for appraisals used for the acquisition of real property by Her Majesty.

There are two options:

1. the CPA carries out, or causes to be carried out, an appraisal and/or environmental assessment and submits the information to Transport Canada. Transport Canada provides the information to PWGSC. PWGSC may accept the information, seek further information or clarification from the CPA, or conduct such further and other studies as it sees fit; or
2. the CPA may request that Transport Canada contract with PWGSC to conduct the appraisal and/or the environmental assessment work directly.

Whether or not PWGSC is reviewing the CPA's reports or is carrying out the work directly, the process will be more efficient and expedient if Transport Canada and PWGSC are involved in transactions involving federal real property at the early stages.

Note (2)

The supplementary letters patent would be effective on the later of the dates of registration of the acquisition documents. As soon as possible upon completion of the transactions, therefore, the CPA shall provide Transport Canada with a copy of the registered documents or a title certificate from the registrar indicating the date of registration. This will be deposited with the original supplementary letters patent in the Transport Canada Legal Registry to document the effective date of the amendment to the letters patent.

Management of Real Property Leased by or Licenced to Her Majesty from a Third Party

[Note - this section is under development and will be forwarded under separate cover]

Notification of Federal Real Property no Longer Required for Port Purposes

Where a CPA is of the opinion that certain real property is no longer required for port purposes, it shall so inform the Minister. Federal real property that is no longer required for port purposes may be removed from the CPA's management by supplementary letters patent, if the Minister is satisfied that the amendment is consistent with the Act.

Once the federal real property is removed from the management of the CPA, the subsequent use of the property is at the discretion of the Minister. Any suggestion submitted by the CPA for the subsequent use of the property would be considered, however, including the sale to a specific third party through the surplus disposal system of PWGSC.

1.  Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister issue supplementary letters patent to remove the property from the letters patent. The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should include, as a minimum:

1. details of the past and current use of the subject federal real property;
2. a statement that the federal real property is no longer required for port purposes;
3. details of any proposed alternative use for the federal real property (e.g. any prospective purchaser) and the business case for the proposed alternative use;
4. an indication of the implications for the CPA if the federal real property remains under CPA management;
5. legal description, opinion on title and survey, as applicable;
6. whether or not the proposed removal is consistent with the CPA's land-use plan;
7. confirmation that the environmental condition has been ascertained and copies of the environmental site assessments (see Note (1) below); and
8. details of any economic, political or social implications concerning the proposed removal. The CPA should advise of the results of public consultations and any public concerns raised.

Note (1) - Environmental Assessment

A CPA may:

1. carry out, or cause to be carried out, an environmental assessment and submit the information to Transport Canada. Transport Canada provides the information to PWGSC. PWGSC may accept the information, seek further information or clarification from the CPA, or conduct such further and other studies as it sees fit; or
2. request that Transport Canada contract with PWGSC to conduct the environmental assessment work directly.

Whether or not PWGSC is reviewing the CPA's reports or is carrying out the work directly, the process will be more efficient and expedient if Transport Canada and PWGSC are involved in transactions involving federal real property at the early stages.

Minister's Consent to Increase Authorized Term of a Lease or Licence of Federal Real Property

A CPA may lease or licence federal real property under its management, subject to the limits set out in its letters patent. The letters patent set out the authorized term of a lease or licence of federal real property depending on the activities or uses involved. A CPA may not grant a lease or licence in excess of those authorized terms, unless the CPA has the written consent of the Minister. The Minister may consent to a lease or licence for a maximum term of 99 years.

Lease or licence terms for CPAs were restricted to ensure that flexibility is maintained for the use of port lands over the long term. This is in keeping with a key objective of the CMA, which is to ensure that Canada maintains the marine infrastructure that it needs. In view of this objective, there are few business cases which would support a term in excess of the authorized limit. Extended terms will, therefore, be authorized only in exceptional circumstances.

1.  Procedure and Time Frame

To initiate the process, the CEO of the CPA sends a letter to the Director General, Airport and Port Programs, to request that the Minister consent to an increase to the lease or licence terms authorized in its letters patent.

2.  Information Required

Should a CPA believe that it has a business case which would support an extension of the authorized term, the letter from the CEO should set out sufficient details of the proposed extension to enable Transport Canada to brief the Minister. The letter should provide, as a minimum:

1. sufficient details of the lease or licence, including:
   1. details of the prospective tenant or licensee, including corporate profile;
   2. the nature of the lease or licence; and
   3. the approximate percentage of the port lands involved in the lease/licence;
2. if a project is involved, details of the project, including a comprehensive development plan, management plan, financial and marketing data, as applicable and details of the proponent's relevant experience;
3. justification of why the authorized term is inadequate, including comparative analysis of the authorized term and the proposed lease or licence term with respect to viability, revenue, marketing, risk, etc.;
4. confirmation that there is other port land available with which the CPA could respond to future port needs;
5. an indication of whether or not the proposed term extension is consistent with the CPA's land-use plan;
6. evidence that the interests of the CPA and the Crown are adequately protected;
7. the risks identified in committing the lands for the proposed term and how the CPA would address such risks;
8. confirmation that the CPA is in compliance with the CEAA and CPAEAR and indication of the CPAEAR public registry reference number for any relevant reports;
9. the implications to the CPA should consent not be granted; and
10. details of any economic, political or social implications concerning the proposed term extension. The CPA should advise of the results of public consultations and any public concerns raised.

Minister's Consent to Lease or Licence Federal Real Property at Less than Fair Market Value

A CPA may lease or licence federal real property under its management, subject to the limits set out in its letters patent. The letters patent provide that every lease or licence of federal real property entered into by a CPA concerning the activities referred to section 8.3 shall, at minimum, be at fair market value, provided, however, that, with the prior written consent of the Minister, certain CPAs may lease or licence federal real property at less than fair market value for prescribed activities.

1.  Procedure and Time Frame

To initiate the process, the CEO of the CPA sends a letter to the Director General, Airport and Port Programs, to request that the Minister consent to the CPA entering into a lease or licence of federal real property at less than fair market value pursuant to section 8.3 of the letters patent.

2.  Information Required

The supporting letter from the CEO should set out sufficient details of the lease or licence to enable Transport Canada to brief the Minister. The letter should include, as a minimum:

1. confirmation that the lease or licence activity is an activity described in activity section 8.3 of the letters patent and sufficient details to support the assertion;
2. details of the prospective tenant or licensee;
3. the fair market value of the lease or licence, if known;
4. the proposed rent, charge or other consideration in lieu of fair market value;
5. the rationale for entering into the lease or licence at less than fair market value, in terms of port development and/or operations;
6. confirmation of whether or not the lease or licence is for the purpose of a project within the meaning of the CEAA and, if yes, confirmation that the CPA is in compliance with the CPAEAR with respect to that project and indication of the CPAEAR public registry reference number;
7. the implications to the CPA should consent not be granted; and
8. details of any economic, political or social implications concerning the proposed lease/licence at less than fair market value. The CPA should advise of the results of public consultations and any public concerns raised.

Annex A - Raising Title (B.C.)

The Province of British Columbia requires a Crown grant for first registration of ungranted federal real property in the provincial land title office. This is known as raising title. Title is raised by registering an Instrument of Grant) in the appropriate provincial land title office. Pursuant to paragraph 16(1)(i) of the Federal Real Property Act , the Governor in Council may, on the recommendation of Treasury Board, authorize the grant by Her Majesty of any federal real property to Herself. This grant may be registered in the appropriate land title office to create a first registered title. Title is raised in the name of Her Majesty the Queen in right of Canada.

A submission to Treasury Board is, therefore, required to raise title. In the context of a sale of federal real property, where a submission to Treasury Board will be necessary for the transaction itself, the CPA may simply indicate in the supporting letter to the Director General that the property is ungranted federal real property and that title must be raised. Transport Canada can seek authorization to raise title and to sell the property in one Treasury Board submission. Consequently, there should not be any appreciable increase in time frame to process the transaction as a result of the need to raise title. Where title needs to be raised in the context of other real property transactions, the CPA may simply include the need to raise title in the letter to the Director General requesting the supplementary letters patent for the transaction. Transport Canada would prepare a submission to Treasury Board requesting authority to raise title.

The CPA should provide sufficient information for Transport Canada to prepare a Treasury Board submission to raise title, including legal description, opinion on title, and survey, as applicable. An additional 35 working days should be factored into the time frame to allow for the request to be heard at Treasury Board and Governor in Council. It should also be noted that Treasury Board does not hold regular hearings during the summer months and you may wish to organize your real property transactions accordingly.

Part II
Transactions Involving Real Property Other than Federal Real Property

Sale or Exchange of Real Property Other than Federal Real Property

Pursuant to subsection 46(2) of the CMA, a CPA may sell or exchange manage, occupy or hold only the real property other than federal real property subject to the issuance as set out in its letters patent. Consequently, supplementary letters patent patent will be required in the event that the CPA sells or exchanges real property described in Schedule C to the letters patent as other real property. The Minister may issue supplementary letters patent if the Minister is satisfied that the amendment is consistent with the CMA.

1.  Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister issue supplementary letters patent to amend Schedule C. The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should include, at a minimum:

1. details of the transaction;
2. confirmation that the transaction is within the authorizations set out in the letters patent;
3. an indication of the implications for the CPA if supplementary letters patent are not granted; and
4. legal description, opinion on title and survey, as applicable.

Note (1)

The supplementary letters patent would be effective on the later of the dates of registration of the sale or exchange documents. As soon as possible upon completion of the transactions, therefore, the CPA shall provide Transport Canada with a copy of the registered documents or a title certificate from the registrar indicating the date of registration. This will be deposited with the original supplementary letters patent in the Transport Canada Legal Registry to document the effective date of the amendment to the letters patent.

Acquisition of Real Property to be Held as Property Other than Federal Real Property

Pursuant to section 7.2 of its letters patent [section 7.3 for the Vancouver Port Authority (VPA)], a CPA may acquire real property to be held as property other than federal real property, subject to the issuance of supplementary letters patent. The Minister may issue supplementary letters patent if the Minister is satisfied that the amendment is consistent with the CMA.

1.  Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister issue supplementary letters patent to amend Schedule C. The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should set out sufficient details of the proposed acquisition to enable Transport Canada to brief the Minister as to why supplementary letters patent should be issued. The letter should include, as a minimum:

1. full disclosure of the details of the proposed acquisition, including:
   1. the name of the vendor;
   2. legal description, opinion on title and survey, as applicable;
   3. appraised fair market value;
   4. expected closing date or other time constraints; and
   5. any conditions or restrictions upon the purchase or on title;
2. the rationale for acquisition in terms of port development and/or operations;
3. confirmation that the proposed acquisition is consistent with the CPA's land-use plan;
4. an indication of the implications for the CPA if the transaction does not proceed;
5. environment:
   1. confirmation of whether or not the acquisition is for the purpose of a project within the meaning of the CEAA and, if yes, confirmation that the CPA is in compliance with the CPAEAR with respect to that project and indication of the CPAEAR public registry reference number; and
   2. confirmation that the environmental condition of the lands has been ascertained and that the lands are or can be made suitable for the intended use; and
6. details of any economic, political or social implications concerning the proposed acquisition. The CPA should advise of the results of public consultations and any public concerns raised.

Note (1)

The supplementary letters patent would be effective on the date of registration of the acquisition document. As soon as possible upon completion of the transaction, therefore, the CPA shall provide Transport Canada with a copy of the registered document or a title certificate from the registrar indicating the date of registration. This will be deposited with the original supplementary letters patent in the Transport Canada Legal Registry to document the effective date of the amendment to the letters patent.

Lease or Licence of Real Property from a Third Party (leasing-in)

A CPA may obtain, as lessee or licensee, a lease or licence of real property other than federal real property for or in connection with the activities described in article 7 of its letters patent. As a CPA may manage, occupy or hold only the real property set out in its letters patent, supplementary letters patent will be required to describe the real property concerned in the proposed lease or licence. The Minister may issue supplementary letters patent if the Minister is satisfied that the amendment is consistent with the CMA.

1.   Procedure and Time Frame

To initiate the process, Transport Canada requires an original certified copy of the resolution of the board of directors requesting that the Minister issue supplementary letters patent to amend Schedule C to reflect the proposed lease or licence of real property to the CPA for, or in connection with, the activities described in article 7 of its letters patent. The CPA should send the resolution with a supporting letter from the CEO to the Director General, Airport and Port Programs.

2.  Information Required

The supporting letter from the CEO which accompanies the resolution should set out sufficient details of the lease or licence to enable Transport Canada to brief the Minister. The letter should include, as a minimum:

1. full disclosure of the details of the proposed lease or licence, including:
   1. confirmation that, pursuant to subsection 7.2(g) of the letters patent [subsection 7.3(g) for the VPA], the CPA is obtaining the lease or licence for, or in connection with, activities set out in article 7 of the letters patent and sufficient details of the proposed activity to support the assertion;
   2. the name of the lessor or licensor;
   3. legal description and plan of the real property concerned; and
   4. proposed date of execution of the lease or licence or other time constraints;
2. the rationale for obtaining the lease or licence in terms of port development and/or operations;
3. confirmation of whether or not the lease or licence is for the purpose of a project within the meaning of the Canadian Environmental Assessment Act (CEAA) and, if yes, confirmation that the CPA is in compliance with the CPAEAR with respect to that project and provide the CPAEAR public registry reference number;
4. the implications to the CPA should supplementary letters patent not be issued; and
5. details of any economic, political or social implications concerning the proposed lease/licence. The CPA should advise of the results of public consultations and any public concerns raised.

Minister's Consent to Increase Authorized Term of a Lease or Licence of Property Other than Federal Real Property (Toronto and Hamilton only)

The Toronto Port Authority (TPA) and the Hamilton Port Authority (HPA) may lease or licence real property subject to the limits set out in their letters patent. The letters patent set out the authorized term of a lease or licence, depending on the activities or uses involved. The TPA and the HPA may not grant a lease or licence in excess of those authorized terms, unless they have the written consent of the Minister. The Minister may consent to a lease or licence for a maximum term of 99 years.

Lease or licence terms for CPAs were restricted to ensure that flexibility is maintained for the use of port lands over the long term. This is in keeping with a key objective of the CMA, which is to ensure that Canada maintains the marine infrastructure that it needs. In view of this objective, there are few business cases which would support a term in excess of the authorized limit. Extended terms will, therefore, be authorized only in exceptional circumstances.

1.  Procedure and Time Frame

To initiate the process, the CEO of the CPA sends a letter to the Director General, Airport and Port Programs, to request that the Minister consent to an increase to the lease or licence terms authorized in its letters patent.

2.  Information Required

Should the CPA believe that it has a business case which would support an extension of the authorized term, the letter from the CEO should set out sufficient details of the proposed extension to enable Transport Canada to brief the Minister. The letter should provide, as a minimum:

1. sufficient details of the lease or licence, including:
   1. details of the prospective tenant or licensee, including corporate profile;
   2. the nature of the lease or licence; and
   3. the approximate percentage of the port lands involved in the lease/licence;
2. if a project is involved, details of the project, including a comprehensive development plan, management plan, financial and marketing data, as applicable and details of the proponent's relevant experience;
3. justification of why the authorized term is inadequate, including comparative analysis of the authorized term and the proposed lease or licence term with respect to viability, revenue, marketing, risk, etc.;
4. confirmation that there is other port land available with which the CPA could respond to future port needs;
5. an indication of whether or not the proposed term extension is consistent with the CPA's land-use plan;
6. evidence that the interests of the CPA and the Crown are adequately protected;
7. the risks identified in committing the lands for the proposed term and how the CPA would address such risks;
8. confirmation that the CPA is in compliance with the CEAA and CPAEAR and indication of the CPAEAR public registry reference number for any relevant reports;
9. the implications to the CPA should consent not be granted; and
10. details of any economic, political or social implications concerning the proposed term extension. The CPA should advise of the results of public consultations and any public concerns raised.

Minister's Consent to Lease or Licence Property Other than Federal Real Property at Less than Fair Market Value (Toronto and Hamilton only)

The Toronto Port Authority (TPA) and the Hamilton Port Authority (HPA) may lease or licence real property subject to the limits set out in its letters patent. The letters patent of the TPA and the HPA provide that every lease or licence of real property concerning certain activities referred to in section 8.3 shall be for not less than fair market value, provided, however, that with the prior written consent of the Minister, they may lease or licence real property at less than fair market value for certain activities.

1.  Procedure and Time Frame

To initiate the process, the CEO of the TPA or HPA sends a letter to the Director General, Airport and Port Programs, to request that the Minister consent to the CPA entering into a lease or licence of real property at less than fair market value pursuant to section 8.3 of its letters patent.

2.   Information Required

The letter from the CEO should set out sufficient details of the lease or licence to enable Transport Canada to brief the Minister. The letter should include, as a minimum:

1. confirmation that the lease or licence activity is an activity described in section 8.3 of the letters patent and sufficient details to support the assertion;
2. details of the prospective tenant or licensee;
3. the fair market value of the lease or licence, if known;
4. the proposed rent, charge or other consideration in lieu of fair market value;
5. the rationale for entering into the lease or licence at less than fair market value, in terms of port development and/or operations;
6. confirmation that the CPA is in compliance with the CEAA and CPAEAR and indication of the CPAEAR public registry reference number for any relevant reports;
7. the implications to the CPA should consent not be granted; and
8. details of any economic, political or social implications concerning the proposed lease/licence at less than fair market value. The CPA should advise of the results of public consultations and any public concerns raised.

Date modified:

2011-11-01

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