Alberta Court Of Appeal Finds Key Portions Of The Amended Impact Assessment Act Remain Unconstitutional

On October 9, 2026, a majority of the Alberta Court of Appeal released its decision in Reference re Impact Assessment Act, as amended, 2026 ABCA 320, concluding that significant aspects of the federal Impact Assessment Act's designated projects regime remain unconstitutional notwithstanding amendments made following the Supreme Court of Canada's 2023 decision.

The reference concerned amendments enacted after the Supreme Court held that the original legislation substantially exceeded Parliament's constitutional authority. The majority concluded that, while the amendments addressed certain aspects of the Supreme Court's decision, key constitutional concerns remain unresolved.

In particular, the majority found that elements of the definition of "adverse effects within federal jurisdiction" extend beyond established federal heads of power and that the statutory scheme continues to permit federal decision-makers to exercise authority over projects based on considerations that are not themselves matters of federal jurisdiction. The majority therefore concluded that the designated projects provisions and related regulations remain unconstitutional except insofar as they apply to federal undertakings.

The decision provides important guidance on the constitutional limits of federal impact assessment jurisdiction. Among other things, the majority emphasized that federal authority must remain tied to matters falling within federal legislative competence and cannot be used to regulate provincially regulated projects as projects in their entirety. The majority also concluded that the amendments did not materially alter the substance of the legislative scheme in a manner sufficient to address the constitutional deficiencies identified by the Supreme Court.

The Court's analysis addressed several issues of broader significance, including the scope of federal authority in relation to impacts on Indigenous peoples, the operation of the Act's revised "non-negligible" threshold, and the continued breadth of the public-interest decision-making framework. Together, these findings offer further judicial guidance on how environmental assessment legislation can engage federal interests while respecting Canada's constitutional division of powers. 

Why this matters

The decision is significant because it provides further guidance on the constitutional boundaries between federal and provincial authority in the regulation of major projects.

For project proponents, investors, lenders, Indigenous groups, and governments, clarity regarding regulatory jurisdiction is an important component of a predictable project approval environment. Major energy, infrastructure, mining, industrial, and manufacturing projects typically involve substantial long-term capital commitments and multi-year development horizons. Uncertainty regarding which level of government may regulate particular aspects of a project, and on what basis, can create delays, increase costs, and complicate investment decisions.

 While the ultimate implications of the decision will depend on whether there are further appeals or legislative responses, the judgment contributes to the ongoing development of a more clearly defined constitutional and regulatory framework for project assessment in Canada. Greater certainty regarding the respective roles of federal and provincial regulators can help support informed investment decisions and enhance confidence in Canada's project development and approval processes.

The Canadian Constitution Foundation participated in the reference as an intervener. DLA Piper represented the Canadian Constitution Foundation, with the team consisting of Heather L. Treacy, K.C., Joshua A. Jantzi, Aziz Aboudheir, and Marle Riley.