The Legislature Raids

UBCIC Critical of Proposed merger of BC Rail with CN Rail

Sheridan Scott
Commissioner of Competition
Competition Bureau, Industry Canada
21st Floor, 50 Victoria Street
Hull, Quebec K1A 0C9
Facsimile: (819) 953-5013

April 23, 2004
Attention: Sheridan Scott, Commissioner of Competition

Dear Commissioner Scott:

Re: Proposed merger of BC Rail with CN Rail

The Union of B.C. Indian Chiefs (UBCIC) is concerned that the province
of B.C. may have willfully mislead or withheld information from the
Competition Bureau regarding the proposed merger of BC Rail and CN Rail.

Instead of meaningfully addressing its fiduciary legal obligations to
Indigenous Peoples, the government of B.C. has engaged in fraud and
deceit: details of the deal between B.C. and CN Rail (the
“Revitalization Agreement”) were kept secret, while the province gave
assurances that no Aboriginal Title or Rights would be impacted by the
Agreement. These assurances are blatant lies. Recently leaked portions
of the Revitalization Agreement indicate that the Agreement is for up to
a period of 900 years, and that B.C. may transfer Crown Lands (where
Aboriginal Title continues to exist and has not been ceded or otherwise
addressed) to CN Rail for $1.00 (one dollar).

We wish to draw your urgent attention to information that the
Competition Bureau is bound to consider in rendering a decision on
whether or not to approve the proposed merger (de facto sale) of BC Rail
and CN Rail:

a) Aboriginal Title and Rights exist along the BC Rail corridor, and are
constitutionally protected under s. 35(1) of the Constitution Act, 1982;

b) The BC Rail line and other operations run directly through the
reserve lands of twenty-five Indigenous communities in British Columbia;

c) The province of B.C. has legal fiduciary obligations to meaningfully
consult with Aboriginal Peoples prior to undertaking or authorizing land
transactions that will impact Aboriginal Title and Rights;

d) Indigenous Peoples and communities along the BC Rail corridor will be
severely and negatively impacted by this transaction;

e) The province of B.C. has not meaningfully consulted with Aboriginal
Peoples about the proposed merger (sale) of BC Rail to CN Rail, and
instead has engaged in fraud and deceit with the aim of withholding the
details of the agreement, and its full impact, from Indigenous Peoples;
and

f) The province of B.C. is not in a legal position to enter or complete
this transaction without engaging in good faith consultations with
Indigenous Peoples.

Below, we set out further information regarding governments’ legal
obligations to Indigenous Peoples, and why we believe the Competition
Bureau must consider these facts prior to rendering a decision.

A. Aboriginal Title and Rights and Lack of Meaningful Consultation

The BC Rail corridor and rail bed are on Aboriginal Title Lands, and
it’s operations impact Aboriginal Rights. Both Canada and the province
of B.C. have fiduciary obligations to Indigenous Peoples regarding
Aboriginal Title and Rights in the BC Rail corridor which have not been
addressed.

The province alleges that there are no Aboriginal Title or Rights issues
raised by this transaction, and therefore no duty to consult with, nor
to meaningfully address and accommodate Indigenous Peoples’ rights.

The province argues that there is no need to consult about the BCR/CNR
transfer because there is no “new” interest being created, merely the
continuation of an existing use. This is not a legally correct position.
The long-term lease (for a period of up to 900 years) transfers
effective ownership and control of the rail bed and rail line from B.C.
to CN Rail, and a transfer of this magnitude triggers a legal obligation
to consult. Any purported transfer of Aboriginal Title lands requires
the consent of Indigenous Peoples.

Indigenous communities who live alongside the BC Rail line have their
rights impacted daily, the building and on-going operation of the rail
line continue to impact upon Aboriginal Title and Rights and the use
that Indigenous Peoples can make of Aboriginal Title lands. A transfer
of effective ownership and operation of BC Rail from the provincial
Crown to a private corporation engages issues relating to fiduciary
obligations over the ongoing operation. Indigenous communities along the
BC Rail corridor adamantly oppose the transfer on their assessment that
this transfer will result in the violation of their Aboriginal Title and
Rights. This Indigenous opposition has been ignored, at the same time
that the Aboriginal Title and Rights impacts of this transfer have been
denied.

The Supreme Court of Canada has interpreted the constitutional
protection afforded to Indigenous Peoples rights under s. 35(1) of the
Constitution Act, 1982 and has said that meaningful and good faith
consultation is required where governments take actions that will impact
upon Aboriginal Title and Rights: Delgamuukw v. B.C.[1] The
Supreme Court has also said that Aboriginal Title includes the right to
choose to what uses these lands can be put. Where a transaction will
significantly impact the Aboriginal Title of Indigenous Peoples, as this
transaction will do, the consent of Indigenous Peoples is required.

In Haida Nation v. Weyerhaeuser,[2] the Haida Nation challenged the transfer and renewal of an existing Tree Farm Licence. The B.C. Court of Appeal held that there was an enforceable consultation duty on transfers or renewals of existing interests if they might impact upon
Aboriginal Title or Rights. The Haida and Taku River Tlingit v. Ringstad[3] cases clearly found a consultation duty on government prior to the proof of Aboriginal Title and Rights in court. Subsequent to the Haida and Taku decisions, the issue of whether government can approve transfers of corporations, without consultation, where Aboriginal Title and Rights will be impacted was considered in Gitksan and other First Nations v. B.C. (Minister of Forests),[4] where the B.C. Supreme Court ordered government to engage in good faith consultations with the aim of seeking “workable accommodations” of the Indigenous Peoples’ rights.

There has been no consultation with Indigenous Peoples. Instead, the province has acted in bad faith by keeping the details of this Agreement secret from Indigenous Peoples.


B. Interests in Reserve Lands

Where BC Rail operates on rights-of-way running through reserve lands
there are significant questions regarding the legality of B.C.’s
proposed transfer or long-term lease of these rights-of-way. The wording
of the right-of-way grants may prevent this transfer of effective
control and usage. The federal government must approve these transfers
as they hold reserve lands in trust for Indigenous Peoples, and the
consent of Indigenous Peoples is required.

As the full contents of the Revitalization Agreement have been kept
secret we cannot comment on the full impact, but it is likely that
conditions of the grants creating the province’s rights-of-way may
prevent a transfer of the nature contemplated by the Revitalization
Agreement. This issue affects interests in reserve lands, directly
engages federal fiduciary obligations, and must be addressed prior to
approval by the Competition Bureau.


C. Competition Bureau’s Legal Obligation to Consider government’s
failure to consult:

The UBCIC is concerned that the province of B.C. may have mislead the
Competition Bureau by claiming an exclusive right to transfer its
interests in BC Rail without first addressing the constitutionally
protected rights of Indigenous Peoples. In making the decision of
whether or not to approve the merger (transfer) of BC Rail to CN Rail
the Competition Bureau is under an obligation to inquire into the full
extent of governments’ consultations with Indigenous Peoples.

The Supreme Court of Canada has found that federally-created tribunals
must consider whether or not government has fulfilled their fiduciary
legal obligations to Indigenous Peoples in rendering their decisions. In
Quebec (A.G.) and Grand Council of the Crees v. Canada (N.E.B.)[5]
<#_ftn5> the Supreme Court said that the National Energy Board “must
exercise its decision-making function, including the interpretation and
application of its governing legislation, in accordance with the
dictates of the Constitution, including s. 35(1) of the Constitution
Act, 1982.”

The constitutional rights of Indigenous Peoples must be addressed. In
the absence of evidence of consultation this transaction cannot be
approved. There has been no consultation; Instead, the province of B.C.
willfully mislead and lied to Indigenous Peoples about this transaction.

The Competition Bureau must be mindful of existing constitutional rights
and consider the privatization deal from the perspective of the impact
that it will have on Aboriginal Title and Rights. Absent proof of
government’s fulfillment of its legal obligations to Indigenous Peoples,
this merger (transfer) cannot be approved.


D. Recommendations:

The UBCIC recommends that:

1) The Competition Bureau require both the federal and provincial
governments to show evidence that they fully and meaningfully consulted
with Indigenous Peoples about the impact of this Agreement on Aboriginal
Title, Rights and interests in reserve lands including a full and complete disclosure of the details of the transactions, so that Indigenous Peoples can fully assess its impact;

2) The Competition Bureau advise the province that it considers the
application incomplete absent evidence of full, meaningful, and good
faith consultations with Indigenous Peoples, including a full disclosure
of all details of the agreement; and

3) That the Competition Bureau undertake a full public inquiry about
this matter, or request that the Competition Tribunal do so. Hearings
should be held in the Indigenous communities along the BC Rail corridor
whose Aboriginal Title, Rights and interests in reserves lands will be
directly and significantly affected.

The Competition Bureau is under a legal duty to refuse to approve this
transaction absent evidence that the federal and provincial governments
have fulfilled their fiduciary obligation to consult with Indigenous
Peoples. That consultation has not occurred. We urge the Competition
Bureau to hold the federal and provincial governments to account for
their failure to address the Aboriginal Title and Rights impacted by the
BC Rail/CN Rail deal.

We look forward to hearing from you how the Competition Bureau is
considering and addressing the constitutional rights of Indigenous
Peoples in its assessment of the BC Rail/CN Rail transaction. We would
be pleased to provide you with further information if this would be of
assistance.

Yours truly,

Union of B.C. Indian Chiefs
[Original signed by Chief Stewart Phillip]
Chief Stewart Phillip
President

C.C.: Union of BC Indian Chiefs’ Chiefs Council
First Nations Summit, Task Group
Vice-Chief Shawn Atleo, Assembly of First Nations, BC Region
National Chief Phil Fontaine, Assembly of First Nations, Ottawa

Honourable Lucienne Robillard
Minister of Industry
11th Floor, CD Howe Building
235 Queen Street
Ottawa, Ontario K1A 0H5 Facsimile: (613) 992-0302

Competition Tribunal
Thomas D’Arcy McGee Building
90 Sparks Street, Suite 600
Ottawa, Ontario K1P 5B4 Facsimile: (613) 957-3170

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