Port Authorities Management Regulations

Port Authorities Management Regulations His Excellency the Governor General in Council, on the recommendation of the Minister of Transport, pursuant to subsection 27(1) of the Canada Marine Acta, hereby makes the annexed Port Authorities Management Regulations. S.C. 1998, c. 10 The definitions in this section apply in these Regulations. Act means the Canada Marine Act. (Loi) auditor includes a partnership of auditors. (vérificateur) beneficial ownership includes ownership of a share or borrowing through a trustee, legal representative, agent or other intermediary. (véritable propriétaire) body corporate includes a company or other body corporate wherever or however incorporated. (personne morale) controlled, in respect of a body corporate, has the meaning assigned in subsection 2(3) of the Canada Business Corporations Act. (contrôle) court means the Ontario Court (General Division); the Superior Court of Quebec; the trial division or branch of the Supreme Court of Prince Edward Island and Newfoundland; the Court of Queen’s Bench for New Brunswick, Manitoba, Saskatchewan and Alberta; the Supreme Court of Nova Scotia and British Columbia; the Supreme Court of the Yukon Territory and the Northwest Territories; and the Federal Court. (tribunal) long-term, in respect of an investment, means that the term to maturity is one year or more but less than 10.5 years. (à long terme) officer, in respect of a port authority, means a person appointed by the board of directors of the port authority under subsection 21(1) of the Act and the chairperson of the board of directors elected under section 17 of the Act. (dirigeant) short-term, in respect of an investment, means that the term to maturity is less than one year. (à court terme) The provisions of the Canada Business Corporations Act, the Canada Corporations Act and the Winding-up and Restructuring Act do not apply to a port authority unless in these Regulations they are expressly stated to apply. These Regulations are binding on Her Majesty in right of Canada or a province. A port authority shall set out its corporate name as set out in its letters patent, in legible characters, in all contracts, invoices, negotiable instruments and orders for goods or services issued or made by or on behalf of it. Subject to subsection (2) and except in the circumstances referred to in section 4, a port authority may carry on business under or identify itself by a name other than its corporate name if that other name does not contain, except in a figurative or descriptive sense, any of the following words or expressions or the corresponding abbreviations: in its English version, “Limited”, “Incorporated” or “Corporation”; and in its French version, “Limitée”, “Incorporée” or “Société par actions de régime fédéral”. A port authority shall not carry on business under or identify itself by a name that is prohibited or deceptively misdescriptive within the meaning of paragraph 12(1)(a) of the Canada Business Corporations Act; or reserved for another corporation under section 11 of the Canada Business Corporations Act. Subsection (1) does not apply to the extent that the use of some other name is authorized under the letters patent. If the street address of the registered office of a port authority changes, the port authority shall submit to the Minister a request for supplementary letters patent that set out the new street address. A port authority shall maintain, at its registered office, records that contain its letters patent, its by-laws and all amendments to the by-laws; a copy of the annual financial statements, for a period of six years after the end of the fiscal year to which they relate; a copy of every document received by it in the last six years notifying it of the appointment or cessation of office of a director; a copy of the constating instruments of each of its wholly-owned subsidiaries, as amended from time to time; a copy of the financial statements of each of its wholly-owned subsidiaries and of each body corporate the accounts of which are consolidated in the latest financial statements of the port authority; and a copy of every document that a wholly-owned subsidiary of the port authority is required to make available to the public under the laws of the jurisdiction in which the subsidiary is incorporated. A port authority shall prepare and maintain at its registered office, a record of what transpired at the last six annual meetings held under the Act; and at its registered office or at such other place in Canada as the board of directors thinks fit, a record of the minutes of meetings and resolutions of the board of directors and committees of directors. In the case of a harbour commission, or a local port corporation within the meaning assigned in section 2 of the Canada Ports Corporation Act, that is continued, deemed to be incorporated or incorporated as a port authority under the Act, the requirement to maintain records that contain minutes of meetings and resolutions of the board of directors and committees of directors includes maintaining similar records that the harbour commission or local port corporation had in its possession before it was continued, deemed to be incorporated or incorporated. Subject to any other Act of Parliament, or any applicable Act of the legislature of a province, that provides for a longer retention period, a port authority shall maintain accounting records at its registered office or at such other place in Canada as the board of directors thinks fit for a period of six years after the end of the fiscal year to which they relate. In the case of a harbour commission, or a local port corporation or non-corporate port within the meaning assigned in section 2 of the Canada Ports Corporation Act, that is continued, deemed to be incorporated or incorporated as a port authority under the Act, the requirement to maintain accounting records includes maintaining similar records that the harbour commission, the local port corporation or the Canada Ports Corporation had in its possession before it was continued, deemed to be incorporated or incorporated. Any record required by the Act or these Regulations shall be prepared and maintained in a form that allows for the reproduction of any required information in intelligible written form within a reasonable time, including a bound or loose-leaf form; a photographic form; a system of mechanical or electronic data processing; or any other information storage device. Every port authority and every wholly-owned subsidiary of a port authority shall ensure that reasonable precautions are taken in respect of records required by the Act or these Regulations to prevent their loss or destruction; prevent the falsification of entries in them; and facilitate the detection and correction of inaccuracies in them. Subject to subsection (2), any person may examine records referred to in subsection 7(1) and paragraph 7(2)(a) during the normal business hours of the port authority. Subject to the Privacy Act, any person may examine records referred to in paragraph 7(1)(c) during the normal business hours of the port authority. To the extent that examination of records is authorized under subsection (1) or (2), extracts from the records may be taken free of charge by the Minister and creditors of the port authority or the agents or legal representatives of the creditors; and on payment of a fee that is reasonable and does not exceed the fees prescribed under the Access to Information Act, by any other person. Records referred to in paragraph 7(2)(b) and section 8 shall at all reasonable times be open to inspection by the directors. A notice or document that is required to be sent to or served on a port authority may be sent by registered mail to the registered office of the port authority. A notice or document required by the Act, these Regulations, the letters patent or the by-laws to be sent to or served on a director of a port authority may be sent by prepaid mail addressed, or may be delivered personally, to the director at the latest address shown for the director in the records of the port authority. A notice or document sent by mail in accordance with this section is deemed to be received or served within the seven days after it was sent. An instrument or agreement executed on behalf of a port authority is not invalid merely because a corporate seal is not affixed to it. A certificate issued on behalf of a port authority stating any fact that is set out in the letters patent, by-laws, minutes of a meeting of the board of directors or a committee of directors, or in a trust indenture or other contract to which the port authority is a party, may be signed by a director or officer of the port authority. When introduced as evidence in a civil, criminal, administrative, investigative or other proceeding, the following things are, in the absence of evidence to the contrary, proof of the facts so certified without proof of the signature or official character of the person appearing to have signed the certificate: a fact stated in a certificate referred to in subsection (1); and a certified copy of minutes or a certified extract from minutes of a meeting of the board of directors or a committee of directors. Subject to the letters patent and the by-laws, the board of directors or a committee of directors of a port authority may meet at any place if reasonable notice is given. The notice of a meeting of directors shall specify any of the following matters that are to be dealt with at the meeting, but, unless the by-laws provide otherwise, need not specify any other business to be transacted at the meeting: filling a vacancy in the office of chairperson or auditor; approving the annual financial statements; approving a borrowing; adopting a land use plan or business plan; adopting, amending or repealing by-laws; and authorizing or ratifying any activity carried on or to be carried on, or any power exercised or to be exercised, by a subsidiary of the port authority. A director may in any manner waive notice of a meeting of directors, and the attendance of a director at a meeting is a waiver of notice of the meeting, except if a director attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting was not lawfully called. Notice of an adjourned meeting is not required to be given if the time and place of the adjourned meeting are announced at the original meeting. Subject to the by-laws, a director may attend a meeting by means of any telephonic, electronic or other communications facility that permits all persons participating in the meeting to communicate adequately with each other during the meeting, and a director participating in the meeting by those means is present at the meeting for the purposes of these Regulations. A resolution in writing signed by all the directors entitled to vote on the resolution is as valid as if it had been passed at a meeting of the board of directors or of a committee of directors, as the case may be. A copy of every resolution shall be kept with the minutes of the proceedings of the board or committee. A director of a port authority who is present at a meeting of the board of directors or of a committee of directors, whether the director abstains from voting on a resolution or an action to be taken at the meeting or remains silent, is deemed to have consented to any resolution passed or action taken at the meeting, unless the director requests that a dissent be entered in the minutes of the meeting or a dissent is so entered; the director sends a written dissent to the secretary of the meeting before the meeting is adjourned; or the director sends a dissent by registered mail, or delivers it, to the registered office of the port authority immediately after the meeting is adjourned. A director who votes for or expressly consents to a resolution is not entitled to dissent. A director who is not present at a meeting at which a resolution is passed or an action taken is deemed to have consented to the resolution or action unless, within seven days after becoming aware of the resolution or action, the director requests that a dissent be kept with the minutes of the meeting; or sends a dissent by registered mail, or delivers it, to the registered office of the port authority. Subsection (3) does not apply to directors who absent themselves from a meeting in conformity with the code of conduct set out in the letters patent. An act of a director or officer of a port authority is valid despite any irregularity in their appointment or election or any defect in their qualification. If a director or officer fails to disclose an interest in a material contract in accordance with the code of conduct set out in the letters patent, a court may, on the application of the Minister or the port authority, set aside the contract on such terms as it thinks fit. The directors of a port authority are jointly and severally, or solidarily, liable to the employees of the port authority for all debts not exceeding six months wages payable for services performed by the employees for the port authority during the period in which the directors held office. A director is not liable under section 19 for any amount in respect of statutory or contractual termination of employment, for severance pay or for any punitive damages related to termination of employment. A director is not liable under section 19 unless the port authority is sued for the debt within six months after it becomes due and execution is returned unsatisfied in whole or in part; the debt is proved within six months after the earlier of the day of issue of the notice of intention to dissolve and the day of issue of the certificate of dissolution; or the port authority makes an assignment or is made subject to a receiving order under the Bankruptcy and Insolvency Act and a claim for the debt is proved no later than six months after the date of the assignment or receiving order. A director is not liable under section 19 unless the director is sued for the debt while in office or within two years after ceasing to be in office. If execution has issued, the amount recoverable from a director is the amount remaining unsatisfied after execution. If a director satisfies a debt referred to in section 19 that is proved in liquidation and dissolution or bankruptcy proceedings, the director is entitled to any preference to which the employee would have been entitled and, if a judgment has been obtained, the director is entitled to an assignment of the judgment. A director who satisfies a debt referred to in section 19 is entitled to contribution from the other directors who were liable for the debt. Directors who vote for or consent to resolutions authorizing any of the following matters are jointly and severally, or solidarily, liable to restore to the port authority any amounts or property so distributed or paid and not otherwise recovered by the port authority: financial assistance contrary to section 32; and payment of an indemnity or advance contrary to section 25 or 28. A director who satisfies a judgment for a debt owed under this section is entitled to contribution from the other directors who were liable for the debt. A director who is liable under subsection (1) may apply to a court for an order to recover money or property mentioned in that subsection. A court may, on application under subsection (3), if it is satisfied that it is equitable to do so, order any person to pay or deliver to the director the money or property mentioned in subsection (1); or make any order that it sees fit. An action to enforce a liability imposed by this section may not be commenced more than two years after the date of the resolution authorizing the action complained of. A director is not liable under any of sections 19 or 21 to 23 if the director exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances to prevent a failure to fulfil their duties, including reliance in good faith on financial statements of the port authority, on the reports of experts and on information presented by officers or professionals. A port authority may indemnify a person who is a director or officer of the port authority, or a former director or officer, against all the costs, charges and expenses, including an amount paid to settle an action or satisfy a claim, reasonably incurred by the person in respect of any civil, criminal, administrative, investigative or other proceeding in which the person is involved by reason of being or having been a director or officer of the port authority. A port authority may not indemnify a person under subsection (1) unless the person acted honestly and in good faith with a view to the best interests of the port authority; and in the case of a criminal or administrative proceeding, the person had reasonable grounds for believing that the conduct was lawful. A port authority may not indemnify a person under subsection (1) in respect of an action by or on behalf of the port authority against the person unless a court so orders. Despite subsection 25(1), a person referred to in subsection 25(1) is entitled to indemnity for the costs, charges and expenses referred to in that subsection if the person was not judged by a court to have committed any fault or omitted to do anything that the person ought to have done; and fulfils the conditions prescribed in subsection 25(2). A court may, on application by a port authority or a person referred to in section 26, approve an indemnity referred to in that section and make any further order that it sees fit. The court may, in respect of the application, order notice to be given to any interested person and the person is entitled to appear and be heard in person or by counsel. A port authority may advance moneys to a person who is a director or officer of the port authority, or a former director or officer, in respect of all the costs, charges and expenses that the person may reasonably incur in respect of any civil, criminal, administrative, investigative or other proceeding in which the person is involved by reason of being or having been a director or officer of the port authority, including an amount to settle an action or satisfy a claim. A port authority may not advance moneys to a person under subsection (1) in respect of an action by or on behalf of the port authority against the person unless a court so orders. If an advance is made under subsection 28(1), the person shall repay the moneys if a court judges that the person did not fulfil the conditions prescribed in subsection 25(2). Unless the letters patent or by-laws provide otherwise, the board of directors of a port authority may fix the remuneration of the officers or employees of the port authority. For the purposes of paragraph 32(b) of the Act, a port authority may invest in the following categories of investments: an investment in a subsidiary that the port authority is authorized to incorporate under its letters patent; any debt that, on the day on which the debt is acquired, is of a category of investments that meets the requirements set out in the schedule; and an investment made in accordance with the Pension Benefits Standards Act, 1985 and the regulations made under that Act if the moneys invested are moneys of a pension fund for a pension plan that is administered by the port authority and registered in accordance with that Act. Subject to the letters patent, a port authority or a body corporate controlled by a port authority shall not, directly or indirectly, give financial assistance by means of a loan, guarantee or otherwise to any of its directors, officers or employees, a shareholder of the body corporate or an associate of any of them; or any person for the purpose of or in connection with a purchase of a share issued or to be issued by the body corporate. For the purposes of subsection (1), “associate” has the meaning assigned in subsection 2(1) of the Canada Business Corporations Act. The annual financial statements required by section 36 of the Act need not be designated by the names set out in subsection 37(2) of the Act. Every port authority and every wholly-owned subsidiary of a port authority shall, in its annual financial statements, set out comparative information from the previous fiscal year’s annual financial statements. A port authority and a wholly-owned subsidiary of a port authority shall each ensure that its annual financial statements include at least the following information: wages, salaries and employee benefits; professional fees and fees for consulting services; maintenance and repair costs; depreciation of fixed assets; and real property taxes and grants in lieu of taxes. A port authority shall ensure that its annual financial statements include the name, title and total remuneration — incorporating fees, allowances and other benefits — of each of the four persons who, in that fiscal year, held office with or were employed by one or more members of the corporate group made up of the port authority and its wholly-owned subsidiaries, and who received the highest remuneration from the group overall. Subsection (2) applies only if the remuneration in the fiscal year exceeds in respect of a fiscal year that ends on or before December 31, 1999, $100,000; and in respect of a fiscal year that ends on or before December 31 of each subsequent year, the amount established in the previous year, adjusted on January 1 of that subsequent year by the change in the consumer price index between the two previous years. The consumer price index for any year is the annual average all-items consumer price index for Canada (not seasonally adjusted) published by Statistics Canada in respect of that year. The chief executive officer and the directors of the port authority or a wholly-owned subsidiary shall not be counted for the purpose of subsection (2). If more than four persons qualify as receiving the highest remuneration because some of them receive the same remuneration, the prescribed information on all of them shall be included in the financial statements. A port authority and a wholly-owned subsidiary of a port authority shall each ensure that its annual financial statements include the following information: total estimated capital expenditures, including those authorized or committed at year end, and, in respect of each capital project for which the combined capital expenditures are estimated to exceed $1 million, a brief description of the project and the amount of the expenditures; and total estimated proceeds from capital dispositions, including dispositions authorized, committed or receivable at year end, and, in respect of each capital disposition for which they exceed or are estimated to exceed $1 million, the amount of the proceeds and a brief description. Information required by sections 35 and 36 may be presented in any one of the categories of income or expenses that is appropriate, broken down among them or presented in a footnote or endnote to the statements. For the purposes of subsection 37(3) of the Act, a port authority and a wholly-owned subsidiary of a port authority shall each specify in its annual financial statements the name, title and total remuneration of every director and every chief executive officer who held office with it in that fiscal year; and the name, title and total remuneration of every officer and every employee of it who held office or was employed in that fiscal year if the remuneration exceeded the threshold prescribed in section 39. The port authority and the wholly-owned subsidiary shall each show in its annual financial statements a breakdown into the following amounts of remuneration in respect of each person referred to in subsection (1): salaries and fees; allowances; and other benefits. Information required by this section may be presented in any one of the categories of expenses that is appropriate or in a footnote or endnote to the statements. For the purposes of paragraph 37(3)(c) of the Act, the remuneration threshold applicable to officers and employees of a port authority or of a wholly-owned subsidiary of a port authority is $150,000. Beginning on January 1, 2000, the remuneration threshold is adjusted on January 1 of each year by the change in the consumer price index between the previous two years. The board of directors of a port authority shall approve the annual financial statements referred to in paragraph 36(a) of the Act and the approval shall be evidenced by the signature of one or more directors. A port authority shall not issue, publish or circulate copies of the annual financial statements unless they are approved and signed in accordance with subsection (1); and accompanied by the report of the auditor of the port authority. Subject to subsection (5), an auditor of a port authority shall be independent of the port authority, any body corporate controlled by the port authority and their directors and officers. For the purposes of this section, independence is a question of fact; and a person is not independent if the person or the person’s business partner is a business partner, director, officer or employee of the port authority or a body corporate controlled by the port authority, or a business partner of a director, officer or employee of any of them, has the beneficial ownership of, or directly or indirectly controls, a material interest in a borrowing of the port authority or a share or borrowing of a body corporate controlled by the port authority, or has been a receiver, receiver-manager, liquidator or trustee in bankruptcy of the port authority or a body corporate controlled by the port authority within two years before the day on which the appointment as auditor would take effect. An auditor who becomes disqualified under this section shall, subject to subsection (5), resign without delay on becoming aware of the disqualification. An interested person may apply to a court for an order declaring an auditor to be disqualified under this section and the office of auditor to be vacant. An interested person may apply to a court for an order exempting an auditor from disqualification under this section and the court may, if it is satisfied that an exemption would not unfairly prejudice the port authority, make an exemption order on any terms that it thinks fit, which order may have retroactive effect. The board of directors of a port authority shall at its first meeting, appoint an auditor to hold office until the close of the first annual meeting; and before the first and each subsequent annual meeting, appoint an auditor to hold office from the close of that annual meeting until the close of the next following annual meeting. Despite paragraph (1)(b), if an auditor is not appointed before an annual meeting, the incumbent auditor continues in office until a successor is appointed. The port authority shall announce at the annual meeting the name of the auditor appointed to hold office beginning at the close of the meeting. The remuneration of the auditor of a port authority shall be fixed by the board of directors. If a vacancy occurs in the office of auditor of a port authority, the board of directors shall without delay appoint an auditor to fill the vacancy for the remainder of the term of the predecessor. If a vacancy occurs in the office of auditor and the board of directors does not appoint an auditor, a court may, on the application of an interested person, appoint and fix the remuneration of an auditor, who holds office until an auditor is appointed by the board of directors. The board of directors of a port authority may remove from office an auditor other than an auditor appointed by the Minister under subsection 43(2) of the Act or by a court. An auditor of a port authority ceases to hold office when the auditor dies or resigns; the auditor is removed; or the auditor ceases to hold office under section 42. The resignation of an auditor becomes effective on the day on which a written resignation is received by the port authority or on the day specified in the resignation, whichever is later. An auditor is entitled to submit a written statement to the port authority giving the reasons for resignation or the reasons for opposing a proposed action or resolution when the auditor resigns; receives a notice or otherwise learns of a meeting of the board of directors called for the purpose of removing the auditor; or receives a notice or otherwise learns of a meeting of the board of directors at which another person is to be appointed to fill the office of auditor, whether because of the resignation or removal of the incumbent auditor or because the term of office has expired or is about to expire. The port authority shall, in respect of the auditor’s written statement, as soon as possible after it is submitted, send a copy to the Minister and to its directors and chief executive officer and the proposed replacement auditor; and publish a notice in a major newspaper published or distributed in the municipalities where the port is situated setting out that the statement is available to the public at its registered office. No person shall accept an appointment or consent to be appointed as the auditor of a port authority if the person is replacing an auditor who has resigned or been removed or whose term of office has expired or is about to expire until the person has requested and received from that auditor a written statement of the circumstances and the reasons, in the auditor’s opinion, for the replacement. Despite subsection (3), a person otherwise qualified may accept an appointment or consent to be appointed as the auditor of a port authority if, within 15 days after making a request referred to in that subsection, the person does not receive a reply. Unless subsection (4) applies, the appointment as auditor of a port authority of a person who has not complied with subsection (3) is null and void. The auditor of a port authority is entitled to receive notice of every annual meeting and, at the expense of the port authority, to attend and be heard at the meeting on matters relating to the duties of the auditor. If a director of a port authority gives written notice to the auditor or a former auditor of the port authority not less than 10 days before an annual meeting, the auditor or former auditor shall attend the meeting at the expense of the port authority and answer questions relating to the duties of the auditor. The director of a port authority who sends the notice referred to in subsection (2) shall send a copy of it concurrently to the port authority. An auditor or former auditor does not contravene subsection (2) unless the auditor knowingly fails to comply with the requirements of that subsection. The auditor of a port authority shall make the examination that is in the auditor’s opinion necessary to enable reporting on the annual financial statements required to be presented at the annual meeting, except the financial statements or part of them that relates to the fiscal year referred to in subparagraph 36(a)(ii) of the Act. An auditor is not liable for relying reasonably on the report of an auditor of a subsidiary of the port authority the accounts of which are included in whole or in part in the financial statements of the port authority. For the purpose of subsection (2), reasonableness is a question of fact. Subsection (2) applies whether or not the financial statements of the port authority reported on by the auditor are in consolidated form. The auditor of a port authority shall prepare the report referred to in paragraph 40(2)(b) in accordance with generally accepted auditing standards as set out in the CPA Canada Handbook, as amended from time to time. At the request of the auditor of a port authority, the present or former directors, officers, employees or agents of the port authority shall provide the auditor with the following if they are reasonably able to do so and if when it is, in the auditor’s opinion, necessary to enable the auditor to make the examination and report required by section 49: information and explanations; and access to records, documents, books, accounts and vouchers of the port authority and its subsidiaries. At the request of the auditor of a port authority, the directors shall obtain from the present or former directors, officers, employees and agents of its subsidiaries the information and explanations that they are reasonably able to provide and that are, in the auditor’s opinion, necessary to enable the auditor to make the examination and report required by section 49; and give the auditor the information and explanations so obtained. A person who in good faith makes an oral or written communication under subsection (1) or (2) is not liable in any civil action arising from having made the communication. A port authority shall have an audit committee whose membership is composed of no fewer than three directors and no member of which is an officer or employee of the port authority or a body corporate controlled by the port authority. The audit committee shall review the annual financial statements of the port authority before they are approved by the board of directors. The auditor of a port authority is entitled to receive notice of every meeting of the audit committee and, at the expense of the port authority, to attend and be heard at those meetings. If requested to do so by a member of the audit committee, the auditor shall attend a meeting of the committee held during the auditor’s term of office. The auditor of a port authority or a member of the audit committee may call a meeting of the audit committee. A director or officer of a port authority shall notify the audit committee and the auditor of any error or misstatement in a financial statement that the auditor or a former auditor has reported on immediately after becoming aware of it. If the auditor or a former auditor is notified or becomes aware of an error or misstatement in a financial statement on which the auditor has reported, and in the auditor’s opinion the error or misstatement is material, the auditor shall inform each director accordingly. On being informed under subsection (2), the directors shall prepare and issue a revised financial statement; inform the Minister and each of the municipalities and provinces mentioned in the letters patent that have a right to appoint a director; and publish a notice in a major newspaper published or distributed in the municipalities where the port is situated stating that the revised financial statements are available for inspection by the public during normal business hours at the registered office of the port authority. A director or officer of a port authority does not contravene subsection (1) or (3) unless the director or officer knowingly fails to comply with the requirements of that subsection. An oral or written statement or report made under the Act or these Regulations by the auditor or former auditor of a port authority has qualified privilege. Every port authority and every wholly-owned subsidiary of a port authority shall ensure that, in respect of itself, a risk assessment is conducted by a competent risk assessor and contains an assessment relating to risk, risk management, property value, risk transfer and probable maximum loss; insurance coverage, limits and deductibles; and underwriters. The risk assessment shall be completed not later than six months after the day on which the port authority is continued, deemed to be incorporated or incorporated under the Act; and at least every five years after the most recent risk assessment. The board of directors of every port authority and of each of the wholly-owned subsidiaries of a port authority shall review each risk assessment report within 30 days after it is received by the port authority or the subsidiary; and approve the insurance coverage annually. In conducting a risk assessment, a risk assessor may, if acting reasonably and in good faith, rely on risk assessments conducted in respect of the property, liabilities and activities referred to in subsection 56(1). Every port authority and every wholly-owned subsidiary of a port authority shall ensure that insurance is maintained in accordance with subsection (2) in respect of the property that the port authority or subsidiary manages, holds, owns or occupies; and liability for the activities in which the port authority or subsidiary engages and for the activities that take place in the port. The insurance shall name the port authority or the wholly-owned subsidiary as the insured party or an additional insured; name Her Majesty in right of Canada as an additional insured; cover the risks and have limits and deductibles that a prudent person in the position of owner of the property or a prudent person engaging in the activities referred to in paragraph (1)(b) would obtain or would require to be obtained, and take into account the most recent risk assessment conducted under section 55; and be maintained with an underwriter that a prudent person in the position of owner of the property or a prudent person engaging in the activities referred to in paragraph (1)(b) would choose or require to be chosen, taking into account the most recent risk assessment conducted under section 55. Every port authority shall purchase and maintain insurance in accordance with subsection (3) for the benefit of itself and Her Majesty in right of Canada against liabilities incurred by it in respect of an indemnity given under subsection 25(1) or an advance given under subsection 28(1). Every port authority and every wholly-owned subsidiary of a port authority shall ensure that insurance is purchased and maintained in accordance with subsection (3) for the benefit of both of them and Her Majesty in right of Canada against liabilities incurred by the subsidiary in respect of an indemnity or advance given by the subsidiary to a former or current director or officer of the subsidiary for liabilities incurred by the director or officer because of being or having been a director or officer of the subsidiary; or a person who, at the request of the subsidiary, has acted or is acting as a director or officer of another entity or has acted or is acting in a capacity similar to that of a director or officer of another entity for liabilities incurred by the person because of so acting. would be obtained by a prudent person in the position of the port authority or subsidiary, and be maintained with an underwriter that a prudent person in the position of the port authority or subsidiary would choose, taking into account the most recent risk assessment conducted under section 55. A port authority may purchase and maintain insurance for the benefit of its former and current directors and officers against any liability incurred by them because of having been or being a director or officer of the port authority; the former and current directors and officers of its wholly-owned subsidiaries against any liability incurred by them because of having been or being a director or officer of the subsidiary; and any person who, at the request of the port authority, has acted or is acting as a director or officer of another entity or has acted or is acting in a capacity similar to that of a director or officer of another entity for any liability incurred by the person because of so acting. The insurance shall cover only situations in which a person mentioned in subsection (1) acted honestly and in good faith with a view to the best interests of the port authority or the subsidiary, as the case may be. A port authority shall indemnify Her Majesty in right of Canada for any action, claim or demand brought against, discharged or satisfied by Her Majesty, or any liability, obligation, loss, damage, cost or expense incurred, discharged or satisfied by Her Majesty because the port authority acted, or in consequence of the port authority acting, as agent of Her Majesty, including, without limiting the generality of the foregoing, an action, claim, demand, liability, obligation, loss, damage, cost or expense arising by or through the acts or omissions of the employees, agents, contractors, tenants or invitees of the port authority or those of any other person; or in respect of a judgment or decision that Her Majesty satisfies, in whole or in part, under subsection 23(1) of the Act. Subsection (1) applies if the action, claim, demand, liability, obligation, loss, damage, cost or expense arises from the port authority’s exercise of, or its failure to exercise, any power or right under the Act, the regulations under the Act or its letters patent; or by operation of law or otherwise, in respect of the operation of the port, including the management, using, occupying, leasing or licensing of federal real property. Subsection (1) does not apply if the action, claim, demand, liability, obligation, loss, damage, cost or expense is in respect of the administration, by the Minister, of the Act or the letters patent; or an agreement or contract between Her Majesty and the port authority, except as provided in the agreement or contract. The Minister shall provide to the port authority notice of any action, claim, demand, liability, obligation, loss, damage, cost or expense for which the port authority is to indemnify Her Majesty and in the case of federal real property, the port authority shall undertake and defend any legal proceedings with respect to that property, as required by paragraph 45(1)(c) of the Act; and in any other case, the Minister shall provide to the port authority an opportunity, in consultation with the Minister and subject to the terms and conditions that the Minister may specify, to assume control of any negotiations, settlement or defence and to discharge or satisfy the action, claim, demand, liability, obligation, loss, damage, cost or expense. The Governor in Council may, by issuing a certificate of intent to amalgamate, require two or more port authorities to amalgamate and continue as one port authority in accordance with the certificate and may, at any time after the period set out in subsection (2), amalgamate the port authorities by issuing a certificate of amalgamation. A notice of the certificate of intent to amalgamate shall be published in at least one major newspaper that is published or distributed in the municipalities where the ports managed by a port authority specified in the certificate are situated. The notice shall state that interested persons may, in accordance with the notice, make written representations to the Minister within 30 days after the day on which the notice is published. A port authority specified in a certificate of intent to amalgamate may, for the purposes of the amalgamation, disclose personal information about its employees to any other port authority specified in the certificate. The Governor in Council may revoke a certificate of intent to amalgamate by issuing a certificate of revocation of intent to amalgamate at any time before the certificate of amalgamation is issued. A notice of the certificate of revocation of intent to amalgamate shall be published in at least one major newspaper that is published or distributed in the municipalities where the ports managed by a port authority specified in the certificate of intent to amalgamate are situated. If possible, the notice shall be published in the same newspapers as the notice of the certificate of intent to amalgamate. The revocation takes effect on the date set out in the certificate of revocation of intent to amalgamate. A certificate of intent to amalgamate and, if applicable, a certificate of revocation of intent to amalgamate shall be sent to each port authority specified in the certificate. A certificate of amalgamation shall specify the day on which the amalgamation takes effect and contain the letters patent of the amalgamated port authority, which include the information set out in subsection 8(2) of the Act. Any certificate issued under this Part shall be published in the Canada Gazette. On the day on which an amalgamation takes effect every director of an amalgamating port authority who remains in office continues as a director of the amalgamated port authority for the balance of their term or until they cease to hold office in accordance with subsection 19(1) of the Act; the navigable waters within the jurisdiction of each amalgamating port authority continue to be within the jurisdiction of the amalgamated port authority; the property, rights and interests of each amalgamating port authority continue to be the property, rights and interests of the amalgamated port authority; the management of any federal real property or federal immovable that the Minister has given to an amalgamating port authority under subsection 44(2) of the Act continues to be given to the amalgamated port authority; the real property or immovables occupied by each amalgamating port authority continue to be occupied by the amalgamated port authority; the amalgamated port authority continues to be liable for the obligations of each amalgamating port authority; an existing cause of action, claim or liability to prosecution is unaffected; a civil, criminal or administrative action or proceeding pending by or against an amalgamating port authority may be continued to be prosecuted by or against the amalgamated port authority; a conviction against, or ruling, order or judgment in favour of or against, an amalgamating port authority may be enforced by or against the amalgamated port authority; every fee fixed by an amalgamating port authority continues in force until the expiry date specified in the provision that fixes the fee or until the amalgamated port authority repeals that provision or replaces the fee; and the letters patent contained in the certificate of amalgamation are the letters patent of the amalgamated port authority. An amalgamation does not constitute a disposition of the property, rights and interests of an amalgamating port authority to the amalgamated port authority. In this Part, the court having jurisdiction is the court in the place where the port authority has its registered office. On the issuance of a certificate of intent to dissolve under subsection 55(1) of the Act and subject to the provisions of the certificate and section 62 of these Regulations, the port authority shall cease to carry on business except the business that is required for an orderly liquidation. Subject to section 62, after the issuance of a certificate of intent to dissolve, the port authority shall without delay have notice of the certificate sent to each of its known creditors; without delay take reasonable steps to give notice of the certificate in each province where the port authority was carrying on business at the time the certificate of intent to dissolve was issued; proceed to collect its property, dispose of properties that are not to be distributed in kind, discharge all its obligations and do all the other acts required to liquidate its business; and after complying with paragraphs (a) and (b) and adequately providing for the payment or discharge of all its obligations, remit the proceeds of liquidation to Her Majesty in right of Canada in accordance with subsection 55(1) of the Act. If a liquidator is appointed to carry out a liquidation of the assets of a port authority, the powers of the directors cease and vest in the liquidator, unless the liquidator or a court authorizes otherwise.

The Minister or any interested person may, at any time during the liquidation of a port authority, apply to a court for an order that the liquidation be continued under the supervision of the court as provided in this Part, and on that application the court may so order and make any further order it thinks fit. In connection with the dissolution or the liquidation and dissolution of a port authority, subject to the certificate of intent, a court may, if it is satisfied that the port authority is able to pay or adequately provide for the discharge of all its obligations, make any order it thinks fit including, without limiting the generality of the foregoing, an order appointing or replacing a liquidator, with or without security, and fixing the remuneration of the liquidator, who, if the court so orders, may be a director or officer of the port authority; an order appointing or replacing inspectors or referees, specifying their powers and fixing their remuneration; an order determining that notice be given to any interested person or dispensing with giving notice to any person; an order determining the validity of any claims made against the port authority; an order, at any stage of the proceedings, restraining the directors or officers from exercising any of their powers, or collecting or receiving any debt or other property of the port authority, or from paying out or transferring any property of the port authority, except as permitted by the court; an order determining and enforcing the duty or liability of any present or former director or officer to the port authority, or third parties, for an obligation of the port authority; an order approving the payment, satisfaction or compromise of claims against the port authority and the retention of assets for that purpose, and determining the adequacy of provisions for the payment or discharge of obligations of the port authority, whether the obligations are liquidated, unliquidated, future or contingent; an order disposing of or destroying the documents and records of the port authority; on the application of a creditor, the inspectors or the liquidator, an order giving directions on any matter arising during the liquidation; after notice has been given to all interested persons, an order relieving the liquidator from any omission or default on any terms that the court thinks fit and confirming any act of the liquidator; subject to any restriction applicable to the port authority, an order approving any proposed interim or final distribution in money or in property; and on the application of a director, an officer, a creditor or the liquidator, an order staying the liquidation on any terms and conditions that the court thinks fit, an order continuing or discontinuing the liquidation proceedings, or an order to the liquidator to restore to the port authority all its remaining property. A liquidator shall without delay after being appointed, give notice of the appointment to the Minister and to each claimant and creditor known to the liquidator; without delay after being appointed, publish notice in the Canada Gazette and once a week for two consecutive weeks in a newspaper published in the place where the port authority has its registered office and take reasonable steps to give that notice in each province where the port authority carried on business, requiring any person who is indebted to the port authority to render an account and pay to the liquidator any amount owing at the day, time and place specified, possesses property of the port authority to deliver it to the liquidator at the day, time and place specified, and has a claim against the port authority, whether liquidated, unliquidated, future or contingent, to present particulars of the claim in writing to the liquidator not later than two months after the date of first publication of the notice; without delay after being appointed, take into custody and control the property of the port authority; without delay after being appointed, open and maintain a trust account for money received by the liquidator in the course of the liquidation; keep accounts of the moneys of the port authority received and paid out in the course of the liquidation; maintain separate lists of the creditors and other persons who have claims against the port authority; if at any time the liquidator determines that the port authority is unable to pay or adequately provide for the discharge of its obligations, without delay apply to the court for directions; deliver to the Minister and the court, if applicable, at least once in every 12-month period after appointment and, in addition, more often as the Minister or the court may require, the information required by section 36 of the Act and sections 34 to 38 of these Regulations; and after the final accounts are approved under section 67, without delay remit the proceeds of liquidation to Her Majesty in right of Canada in accordance with subsection 55(1) of the Act. A liquidator may, subject to the certificate of intent, retain lawyers, notaries, accountants, engineers, appraisers and other professional advisers; bring, defend or take part in any civil, criminal or administrative action or proceeding in the name and on behalf of the port authority; carry on the business of the port authority that is required for an orderly liquidation; subject to any restriction applicable to the port authority, sell any property of the port authority by public auction or private sale; do all acts and execute any documents in the name and on behalf of the port authority; subject to any restriction applicable to the port authority, borrow money; settle or compromise any claims by or against the port authority; and do all other things necessary for the liquidation of the port authority and the distribution of its property. A liquidator is not liable under these Regulations if the liquidator exercised the care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances to prevent a failure to fulfil their duties, including reliance in good faith on financial statements of the port authority, on the reports of experts and on information presented by officers or professionals. If a liquidator has reason to believe that a person possesses or controls or has concealed, withheld or misappropriated property of the port authority, the liquidator may apply to a court for an order requiring the person to appear before the court on the day and at the time and place specified in the order and to be examined. If the examination discloses that the person has concealed, withheld or misappropriated property of the port authority, the court may order the person to restore it to the liquidator or pay compensation for it. Subject to any restriction applicable to the port authority, a liquidator shall pay the costs of liquidation out of the property of the port authority and shall pay or make adequate provision for all the claims against the port authority. Within one year after being appointed and after paying or making adequate provision for all the claims against the port authority, the liquidator shall apply to the court for an approval of the final accounts of the liquidator and for an order permitting the remittance of the proceeds of liquidation to Her Majesty in right of Canada in accordance with subsection 55(1) of the Act; or an extension of time, setting out the reasons for the extension. The liquidator shall give notice of intention to make an application under subsection (2) to the Minister, to any inspector appointed by the court and to any person who provided a security or fidelity bond for the liquidation, and the liquidator shall publish the notice in a major newspaper published in the place where the port authority has its registered office or as otherwise directed by the court. If the liquidator fails to make the application, the Minister may apply to the court for an order requiring the liquidator to show cause why a final accounting and distribution should not be made. If the court approves the final accounts rendered by the liquidator, the court shall make an order directing the custody or disposal of the documents and records of the port authority; and an order discharging the liquidator that is contingent on the liquidator, forthwith on the issuance of the order, sending a certified copy of it to the Minister. Despite the dissolution of a port authority, a civil, criminal, administrative, investigative or other proceeding by or against the port authority before its dissolution may be continued as if the port authority had not been dissolved; a civil, criminal, administrative, investigative or other proceeding may be brought against the port authority within two years after its dissolution as if the port authority had not been dissolved; and any property that would have been available to satisfy a judgment or order if the port authority had not been dissolved remains available for that purpose. Service of a document on a port authority after its dissolution may be effected by serving it on the Minister. Despite the dissolution of a port authority, a person to whom any of the port authority’s property is distributed is liable to any other person claiming under subsection (1) to the extent of the amount received by that person on the distribution, and an action to enforce that liability may be brought within two years after the date of the dissolution of the port authority. On the dissolution of a port authority, the portion of the property distributable to a creditor who cannot be found shall be converted into money and paid to Her Majesty in right of Canada. The payment constitutes satisfaction of the debt or claim of the creditor. If at any time a person establishes entitlement to any moneys paid to Her Majesty in right of Canada under these Regulations, the Receiver General shall pay an equivalent amount to the person out of the Consolidated Revenue Fund. A person who knowingly makes or assists in making a financial statement referred to in section 36 of the Act or paragraph 53(3)(a) or 65(h) of these Regulations is guilty of an offence if the financial statement contains an untrue statement of a material fact; or omits to state a material fact that is required or necessary in order to prevent a statement contained in the financial statement from being misleading in the light of the circumstances in which it was made. A person referred to in section 70 is liable to a fine of not more than $5,000 in the case of an individual, and of not more than $50,000 in the case of a corporation. These Regulations come into force on March 1, 1999. A long-term investment shall at a minimum, meet the rating requirements set out in column 2 of the table to this schedule in respect of at least two of the corresponding rating entities set out in column 1; and be issued by a borrower having a senior unsecured debt rating assigned by those rating entities. One of the rating entities shall be Moody’s Investors Service or Standard & Poor’s. Subject to subsection (2), a short-term investment shall, at a minimum, meet the rating requirements set out in column 3 of the table to this schedule in respect of at least two of the corresponding rating entities set out in column 1. A short-term investment that was originally issued for a term of one year or more shall at a minimum, meet the rating requirements set out in column 4 of the table to this schedule in respect of at least two of the corresponding rating entities set out in column 1; and One of the rating entities shall be Moody’s Investors Service or Standard & Poor’s if either of them assigns a rating for that investment.