Ottawa Won't Appeal Ruling That Impact Assessment Act Is Unconstitutional, Will Amend Law Instead

The federal government has confirmed it will not appeal the Alberta Court of Appeal's ruling that the amended Impact Assessment Act is unconstitutional to the Supreme Court of Canada, and will instead amend the legislation in response to the ruling. Amy Falkner, press secretary to Environment Minister Julie Dabrusin, confirmed the decision to The Canadian Press on Thursday. (Photo: Parliament Hill in Ottawa, file photo.)

Court ruled 4-1 the amendments did not fix the problem

On October 9, the Alberta Court of Appeal ruled 4-1 that Ottawa's 2024 amendments had not resolved the problems the Supreme Court identified in 2023. The majority found the law's definition of "adverse effects within federal jurisdiction" and its decision-making provisions still too broad, allowing Ottawa to halt projects inside a province even where the impact on federal jurisdiction is minimal. The lone dissenter, Justice Kevin Feehan, held that the 2024 amendments had sufficiently answered the Supreme Court's concerns and that the act should stand in full.

Seven years of litigation, from 2022 to the Supreme Court

The dispute has run for seven years. The Alberta Court of Appeal first found the original act unconstitutional in May 2022; in 2023 the Supreme Court ruled that the portion of the act governing "designated projects" exceeded Parliament's jurisdiction and was unconstitutional, while some procedural provisions survived. After Parliament amended the act in 2024, Alberta referred the revised version back to the Court of Appeal, which again found it unconstitutional. Because a Court of Appeal reference opinion is advisory rather than binding, Ottawa's decision not to appeal is the decisive step — there will be no Supreme Court round.

Alberta claims victory; environmentalists disappointed

Alberta Premier Danielle Smith and Justice Minister Mickey Amery issued a joint statement Thursday calling the ruling a major win for provincial jurisdiction and resource development, saying the 2024 amendments failed to fix core flaws threatening jobs and Alberta's economy. Environmental group Ecojustice said it was "deeply disappointed," arguing the decision leaves the future of federal impact assessment law uncertain and raises doubts about the government's commitment to a strong federal role in environmental protection.

Amendment details pending; to work with Bill C-39

Falkner said the details of the amendments "will be confirmed in due course" and that Canada will move quickly to provide certainty to investors, industry and Indigenous Peoples; she did not say when the details would be shared. In the interim, the Impact Assessment Agency of Canada will work with proponents case by case to determine the best path forward for their project assessments. The amendments will work alongside Bill C-39, now before Parliament, which would give the Canada Energy Regulator sole authority to assess designated pipelines, power lines and nuclear and uranium projects, and shorten review times.