Marine Pilotage in Canada: En Route to Modernizing The Pilotage Act?

(Disponible en français : Le pilotage maritime au Canada : en route vers la modernisation de la Loi sur le pilotage?)

On 31 May 2017, Transport Canada launched its Pilotage Act Review, chaired by Marc Grégoire, a former Commissioner of the Canadian Coast Guard and former Assistant Deputy Minister of Safety and Security at Transport Canada. The purpose of the review was to update the Act, which sets out the legislative framework for delivering marine pilotage services in Canada. On 22 May 2018, Transport Canada published the final report of the Review, which made 38 recommendations; it was suggested that the Government of Canada review the purpose of the Act, improve the governance model for pilotage in Canada, implement a new risk assessment methodology, and simplify the tariff-setting process.

Figure 1 – Pilotage Authorities in Canada

Canadian Pilotage System

Marine pilotage is a service where marine pilots take control of a vessel and navigate it through ports, straits, lakes, rivers and other waterways. According to a 1968 report from the Royal Commission on Pilotage, pilotage in Canada dates back to early colonial days and has operated on an organized basis on the St. Lawrence River for over 200 years.

When the Pilotage Act was enacted in 1972, it paved the way for the creation of four Pilotage Authorities across the country to operate and maintain safe and efficient pilotage services in a designated area. Each authority has the exclusive right to provide pilotage services within their geographic area of operation.

Figure 2 – Compulsory pilotage areas under the authority of the Pacific Pilotage Authority

This map identifies the 5 zones along the West Coast of British Columbia in which there are ports that require official pilotage. Port size is illustrated as defined by the World Port Index. As expected, the medium sized ports of Victoria Harbour, Prince Rupert and New Westminster as well as the large port of Vancouver require pilotage. There are also several small and very small ports requiring pilotage that dot the coastline around Vancouver Island and up the West coast of BC.

Figure 3 – Compulsory pilotage areas under the authority of the Great Lakes and Laurentian Pilotage AuthoritiesThis map illustrates a dense population of small and very small ports requiring pilotage along the shores of the great lakes and scattered along the St.Lawrence river. Lake Superior contains the least number of ports. The United States contains more ports in general. Thunder Bay, Windsor, Hamilton, Toronto, Montréal, Trois-Rivières, and Québec are the medium and large Canadian ports that require pilotage.

Figure 4 – Compulsory pilotage areas under the authority of the Atlantic Pilotage AuthorityThis map illustrates many small and very small ports requiring compulsory pilotage in Eastern Canada. Saint John, the Canaport LNG terminal port, and Halifax are the largest ports, while Sydney maintains a medium port. Not all small and very small ports appear in the World Port Index.

Maps prepared by Library of Parliament, Ottawa, 2018, using data from Natural Resources Canada (NRCan), “Administrative Features,” Administrative Boundaries in Canada – CanVec Series, 2018; NRCan, “Boundary Polygons” and “Waterbodies,” Atlas of Canada National Scale Data 1:5,000,000 Series, 2013; National Geospatial-Intelligence Agency, World Port Index, accessed 30 July 2018; Great Lakes Pilotage Authority, Great Lakes Pilotage Region Districts Map; Laurentian Pilotage Authority, Geographical Limits of Activities; Atlantic Pilotage Authority, Compulsory Areas; and data provided by the Pacific Pilotage Authority for compulsory pilotage areas. The following software was used: Esri, ArcGIS, version 10.4. Contains information licensed under Open Government Licence – Canada.

The four Pilotage Authorities establish their compulsory pilotage areas through regulation, prescribing which vessels are subject to compulsory pilotage, and prescribing the circumstances under which compulsory pilotage may be waived. The types of vessels subject to the regulations made by the Pilotage Authorities vary significantly; they include cargo ships, pleasure craft of a certain size and oil rigs.

Pursuant to the Pilotage Act, for a vessel to navigate within the areas set out by the Pilotage Authorities, often along the coast or near ports, it must “be under the conduct of a licensed pilot or the holder of a pilotage certificate.” The pilot must go out to the vessel, often using a pilot boat, if it is at sea, board the vessel and guide the vessel until it is out of the compulsory pilotage area.

The Pilotage Authorities are financially self-sustaining and do not receive parliamentary appropriations. Their largest expenses are pilot salaries and the costs associated with pilot boats. Their revenues are from tariffs paid by the vessels (shipowners) that use the waterways within each authority’s area.

Figure 5 — Expenses, Revenues and Number of Pilotage Assignments in Canada (2008 to 2017)

Note: The format and content of the figures is inspired by tables 1, 2, 3 and 4 from Marc Grégoire. Pilotage Act Review Final Report, Transport Canada, April 2018.
Source: Figure prepared by the author using data from Transport Canada. Transportation in Canada 2017: Statistical Addendum, 2018.

The Pilotage Authorities set their own tariffs for pilotage services by regulation. Objections can be filed with the Canada transportation Agency if anyone believes the tariffs are not in the public interest. According to Transport Canada, the entire process to set the tariffs takes about six to eight months to complete, including the consultations and approval by the Governor in Council.

The federal General Pilotage Regulations outlines certain health and navigational qualifications for applicants for licences or pilotage certificates. Every Pilotage Authority can impose additional criteria for the issuance of a licence or certificate; the costs of issuing them can vary between authorities.

While the Act authorizes the Pilotage Authorities to hire employees, when pilots in a given area decide to form a corporation, the Pilotage Authorities can contract for the services of pilots in that area with the corporation. However, pilots employed by a Pilotage Authority and pilots belonging to a corporation cannot provide services in the same compulsory pilotage areas.

Table 1 – The Number of Pilots, Pilotage Assignments, and Average Number of Assignments per Pilot for the Four Pilotage Authorities in Canada in 2017

Pilotage Authorities Pilotsa Pilotage Assignments Average Number of Assignments per Pilot
 

Employees

Contractors

   
Atlantic 49 10 8,809 149
Laurentian 0 192 22,732 118
Great Lakes 59b 0 7,636 143
Pacific 8 114 13,397 110

Total for all authorities

116 316 52,574 123

 

432

   

Note: a. Includes apprentice pilots.
b. According to the Annual Report 2017 of the Great Lakes Pilotage Authority, in addition to 53.6 FTE pilots, five pilots obtained their licence in 2017.

Source: Data on pilots taken from: the Atlantic Pilotage Authority, Annual Report 2017; the Laurentian Pilotage Authority, Annual Report 2017; the Great Lakes Pilotage Authority, Annual Report 2017; and the Pacific Pilotage Authority, Annual Report 2017. Data on number of assignments and average number of assignments per pilot are taken from Transport Canada, Transportation in Canada 2017: Statistical Addendum, 2018.

In the case of a disagreement between the Pilotage Authorities and the pilots’ corporations regarding the terms of the contracts for services, a mediator or an arbitrator is appointed to resolve the dispute. If outstanding issues remain, the mediator or arbitrator will ask each party to present a final offer and will choose one or the other of the final offers in its entirety. As pilotage services are compulsory under the Act, services must be maintained during the mediation or arbitration process.

Pilotage Act Review

The Pilotage Act Review is part of the Government of Canada’s Oceans Protection Plan. According to Transport Canada, the Review aims to “modernize the Pilotage Act while keeping elements that support Canada’s excellent pilotage safety record.” The sections below provide a summary of the 38 recommendations in the final report of the Review.

A. Governance

Most of the stakeholders consulted as part of the Pilotage Act Review (industry, Pilotage Authorities and pilots) believe it is preferable to keep the four Pilotage Authorities separate to ensure local expertise is not lost. However, the report recommends merging the Great Lakes Pilotage Authority and the Laurentian Pilotage Authority, given their proximity and how closely they work together already. In addition, the report recommends creating a National Advisory Committee that would serve as a “national forum” for all pilotage stakeholders.

B. Labour

Despite opposition from pilots’ corporations, the report recommends that the Act be amended so that Pilotage Authorities can hire their own employees and also contract with a pilot corporation in the same pilotage district. This recommendation aims to ensure that Pilotage Authorities are able to use the workforce configuration that best meets their needs and that expertise is developed within the local Pilotage Authority.

Several stakeholders pointed out issues with the arbitration process when Pilotage Authorities and pilots’ corporations disagree on the terms of the contracting arrangement, as the arbitration process does not take into account the long-term viability of the Pilotage Authorities (for example, when the arbitrator chooses an offer that is not financially viable for the Pilotage Authority). The report recommends that the final offer selection process be amended such that the arbitrator must consider the purpose and principles of the Act, including the financial independence of the authorities.

C. Safety Framework

According to the report on the Pilotage Act Review, 99.9% of marine pilotage assignments in Canada are incident free. Under the current framework, each authority establishes regulations outlining the type and size of vessel subject to compulsory pilotage. In response to calls from various stakeholders for greater standardization at the national level, the report recommends that the Minister of Transport, with the approval of the Governor in Council, be provided with the authority to make all regulations pertaining to pilotage safety. Also with a view to increasing standardization, the report recommends that Transport Canada promote a national pilotage certification program for the training and evaluation of ship masters and navigational officers.

D. Tariffs and Fees

The report notes that the regulatory process for amending tariff rates is “cumbersome and lengthy” and that there is a disconnect between the regulatory process and the annual planning process. Therefore, the report recommends that the Pilotage Authorities have “complete authority” to set tariffs and other fees, while continuing to consult stakeholders. In addition, the report proposes amending the process for filing a tariff objection so that only those parties subject to tariff charges can file objections with the Canadian Transportation Agency.

Additional Resources

Transport Canada, Pilotage Act Review discussion, October 2017.

Transport Canada, Pilotage Act Review: Research Summaries, February 2018.

Transport Canada, Pilotage Act Review: Submissions, March 2018.

Author: Geneviève Gosselin, Library of Parliament

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