Canada: Ontario Moves To Formalize The Use Of Third-Party Off-Sets Under The Endangered Species Act, 2007

The Ontario government has published the results of its 10-year review of the Endangered Species Act, 2007, S.O. 2007, c. 6(the "Act"). While the results are reported in summary fashion, the review has resulted in multiple proposed changes to the Act.

The proposed changes have been posted on the Environmental Registry under five broad categories:

  1. Permits and Exemptions
  2. Listing Species at Risk
  3. Species and Habitat Protection
  4. Recovery Policies
  5. Enforcement

While there are multiple proposed changes worth commenting on, by far the one garnering the most attention is with respect to permits and exemptions. Specifically, the proposal to create a new Crown agency and the option to pay a charge in lieu of undertaking otherwise required on-the-ground activities has met with a strong reaction.

1. Permits and Exemptions:

While the Act prohibits the killing, harming, harassing and damaging/destroying the habitat of an endangered or threatened species, it currently contains a number of tools, like conditional permits, agreements and regulatory exemptions, to permit otherwise prohibited activities. An explanation of these tools can be found on the government's species at risk webpage. Among these tools is what is called an "Overall Benefit Permit".


An Overall Benefit Permit builds on the concept of off-sets. That is, it permits harm to biodiversity at one site in exchange for the creation, restoration or enhancement of biodiversity elsewhere (an "off-set"). Currently, as the name indicates, the benefit of the off-set must be greater than the permitted harm.

These types of off-set programs are already happening with success in one-off projects in Ontario. In some instances they have involved the developer of land generating their own off-set, while in other cases the developer has paid a third-party conservation organization to establish and maintain the off-set. A useful case study overview of some of these projects has been published by Ontario Nature, titled, "Biodiversity Offsetting in Ontario" (October 2016).

Species at Risk Conservation Trust

The government now appears to be proposing to systematize the purchase and sale of off-sets through the establishment of a new Crown agency, called the Species at Risk Conservation Trust.

The proposal summary indicates that this agency would allow "municipalities or other infrastructure developers the option to pay a charge in lieu of completing certain on the ground activities required by the act" with the funds supporting "strategic, coordinated and large-scale actions that assist in the protection and recovery of species".

The summary does not provide much detail, but this proposal for a payment-in-lieu regime has met with strong condemnation from multiple environmental advocacy groups who oppose any payment-in-lieu regime that will simply make it easier for industry/development proponents to harm species at risk and damage or destroy their habitats (see Recommendation 8 from Ontario Nature et al., Comments on the Review of the ESA).

Biodiversity off-setting can be a controversial concept. Its merit as a tool for environmental protection is largely driven by the details of the program. The challenge here is that the proposal summary is short on specifics. For example, some of the unanswered questions are:

  • Is this program intended to result in "no net loss" of biodiversity or "net gain"?
  • Will the off-set outcomes be required to be of the same duration of the negative impacts?
  • Will developers be required to avoid and minimize impacts before having resort to a payment-in-lieu?
  • Will the payments only be used for on-the-ground activities that benefit species at risk and their habitats, or will funding of studies and research be sufficient?

Ultimately, biodiversity offsetting is a promising mechanism that is increasingly being considered in jurisdictions worldwide, but its efficacy is in the details.

2. Listing Species at Risk

The species at risk regime begins with a listing decision. This is how a species comes to be protected under the Act. The process involves the scientific study of a species by the Committee on the Status of Species at Risk in Ontario (COSSARO) to determine if it is endangered, threatened, of special concern, extirpated or extinct.

Currently, species that meet these categories must be protected (added to the list of Species at Risk in Ontario) within three months of COSSARO's study. As soon as the species is added to the endangered or threatened list, killing, harming, harassing or damaging/destroying its habitat is prohibited without a government permit or authorization.

Among the proposed changes is a requirement to provide public notice prior to the listing of a species, and to extend the timeline for listing from 3 months to 12 months.

3. Species and Habitat Protection:

Currently, for species that are endangered or threatened, the Act's protections come into effect immediately upon listing.

The proposed changes would allow the Minister to delay protections for up to 3 years where certain requirements are met, which include: the delay will not jeopardize the survival of the species, the prohibition will have significant social or economic impacts, and the species is broadly distributed in Ontario, habitat is widely available, or additional time is needed to address primary threats.

4. Recovery Policies:

Under the Act, there is a requirement for a scientific Recovery Strategy to be developed for each endangered or threatened species, followed by a Government Response Statement within 9 months that details the policy direction for actions to be taken.

Under the Act, there is a requirement for a scientific Recovery Strategy to be developed for each endangered or threatened species, followed by a Government Response Statement within 9 months that details the policy direction for actions to be taken.

Among the changes is a proposal to provide the Minister with discretion to extend the 9-month deadline for a Response Statement, and to remove the requirement to post the Statement on the Environmental Registry.

5. Enforcement:

The Summary reports that the decision to transition responsibility from the Ministry of Natural resources and Forestry to the Ministry of the Environment, Conservation and Parks, necessitates some enforcement changes. Among these is applying inspection and enforcement provisions to the regulations and providing the Minister with greater discretion with respect to designation of enforcement officers.


Overall, these proposed changes signal a significant shift in the management of species at risk in Ontario. While greater permitting flexibility is likely to be welcomed by developers, the details of this new regime will determine whether this efficiency has been bought at the expense of environmental outcomes.

The proposed changes are open for public comment until May 18, 2019.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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