Canadian Coast Guard Marine
Services Fees Information Bulletin

Number Nineteen
December, 2001

This bulletin is provided to inform the greater marine community on developments affecting the Canadian Coast Guard's Marine Services Fees (MSF) initiative. It is our intention that the bulletin will be issued as progress and developments warrant. Additions (or deletions) to the mailing list are invited.

Freeze of Marine Services Fees Ends

Industry / Canadian Coast Guard Review of Fees Continues

The three-year freeze on Marine Services Fees has ended, as scheduled, on October 1, 2001. However, the rates in effect during this three-year fee freeze will remain in effect until further notice. This decision applies to both the Marine Navigation Services Fee and the Icebreaking Services Fee.

This decision to continue with the current fee rates was taken in order to provide the Canadian Coast Guard and the Marine Advisory Board with the opportunity time required to continue with finalize the on-going review of both Marine Services Fees.

The fee review will also consider industry's proposal for a long-term fee arrangement with the Canadian Coast Guard. This proposal was received earlier this year at the invitation of the Commissioner of the Canadian Coast Guard.

The Marine Advisory Board

The Marine Advisory Board is composed of key marine stakeholders, representative of all regions in the country. Chaired by the Commissioner of the Canadian Coast Guard, this Board meets on a regular basis to review maritime issues of mutual interest between industry and the Coast Guard.

The matter of Marine Services Fees is of particular interest to industry, and the Marine Advisory Board has established a Working Group to work with the Coast Guard on the review of fees.

Extension of the Current Marine Services Fees Rates

The fee review was intended to conclude with recommendations earlier this year, with fee adjustments to be implemented to coincide with the end of the fee freeze on October 1, 2001.

For this review to be completed successfully, it requires important information from two studies now being undertaken by the Treasury Board Secretariat. These studies - an economic study into the impact of all fees on the marine sector, and a review of the Government's cost recovery policy - are expected to be completed in early 2002.

Accordingly, the decision to allow fees to remain at current levels beyond the end of the fee freeze, was taken to allow the Working Group fee review to continue the fee review while awaiting the results of the two important these studies. With the benefit of the two studies from Treasury Board Secretariat studies, it is likely that a proposed fee package will be available from the review for consultation with stakeholders by the Spring of 2002.

However, because Coast Guard cannot be sure of when the review will conclude during the coming year, the decision was taken to allow the current rates to continue, rather than extending the fee freeze to a specific date.

Two other decisions facilitated the Coast Guard's ability to allow the current rates to continue.

First, the Treasury Board agreed to extend the current Icebreaking Services Fee financial relief beyond its December 20, 2001 conclusion to March 31, 2002. This relief amounts to $6.9M annually. This relief allowed the rates to be set 50% lower than proposed when icebreaking fees were introduced in 1998.

Second, the Coast Guard will continue to absorb any the continuing revenue shortfall from both the Marine Navigation Services Fee and the Icebreaking Services Fee. Over the course of the three-year fee freeze, this combined shortfall was $15.9M. In the last year of the freeze, the combined revenue shortfall was $2.3M.

Developments and Future Consultations

As discussions on the fee review Marine Service Fees continue, the Marine Services Fees Information Sheet will be used to convey all important developments.

With regard to consultations, all stakeholders with an interest in Marine Services Fees will have the opportunity to comment on all proposed changes to the fees that may emerge from the review. Thus, this consultation will not be limited to those interests represented on the Marine Advisory Board.

Providing Input to the Fee Review

Your views are welcome. To provide your input to the fee review, or to seek further information concerning the fee review, please contact Ted Wallace, Project Manager, Marine Services Fees Review, Canadian Coast Guard, 200 Kent Street, 6^th Floor, Ottawa, Ontario, K1A 0E6. Telephone (613) 993-0409; Fax (613) 998-0460; E-mail wallacet@dfo-mpo.gc.ca

For specific information regarding Marine Services Fees billing and collection, please contact Danny Napier, Manager, Marine Services Fees Billing, Collection and Compliance, Department of Fisheries and Oceans, 240 Bank Street, Stn. 3-37, Ottawa, Ontario, K1A 0E6. Telephone (800) 563-6295; Fax (613) 990-4338; E-mail napierd@dfo-mpo.gc.ca

The Marine Services Fees Information Sheet provides interpretations of fee schedules imposed under the Oceans Act. These interpretations are not binding and, where a discrepancy between the two documents arises, the fee schedule will always take precedence.