- within Government and Public Sector topic(s)
- with Inhouse Counsel
- in United States
- with readers working within the Property, Law Firm and Construction & Engineering industries
In early June 2025 the federal government tabled the One Canadian Economy Act (referred to as "Bill C-5") to expedite nation-building infrastructure projects and reduce interprovincial trade barriers. Bill C-5 received royal assent shortly thereafter on June 26, 2025.1
Bill C-5 enacts two new pieces of legislation:
(1) the Building Canada Act, which aims to "urgently advance" infrastructure projects which serve the national interest, including energy projects; and
(2) the Free Trade and Labour Mobility in Canada Act, which seeks to eliminate federal barriers to the interprovincial movement of goods, provision of services, and movement of labour.
This article considers the key elements of the new Building Canada Act, including the designation of national interest projects.
1. Building Canada Act – An Overview
The Building Canada Act accelerates the regulatory process for infrastructure projects which are designated as being in the national interest. The purpose of the Building Canada Act is to "enhance Canada's prosperity, national security, economic security, national defence and national autonomy by ensuring that projects that are in the national interest are advanced through an accelerated process that enhances regulatory certainty and investor confidence, while protecting the environment and respecting the rights of Indigenous peoples."2
The Building Canada Act contemplates the following two-step streamlined process: (1) the designation of a project as being in the national interest; and (2) issuance of a single federal authorization for the designated project.
a. Designating National Interest Projects
The Building Canada Act empowers the Governor in Council (i.e., effectively the federal cabinet) to designate infrastructure projects as being in the national interest. In deciding whether to designate a project, the Governor in Council may consider "any factor" that it considers relevant, including the extent to which the project can,
- strengthen Canada's autonomy, resilience and security;
- provide economic or other benefits to Canada;
- have a high likelihood of successful execution;
- advance the interests of Indigenous peoples; and
- contribute to clean growth and to meeting Canada's objectives with respect to climate change.3
Once a project is designated as a national interest project, every determination and finding made and every opinion formed in order for an authorization to be granted in respect of the project is deemed to be made or formed in favour of approving the project.4 However, this does not exempt a proponent from the requirement to comply with the relevant legislation,5 but merely frames the regulatory question as how to approve and not whether to approve.
b. Accelerated One Approval
Once a project is designated as being in the national interest, the Minister (i.e., an appointee of the Governor in Council who is a member of the King's Privy Council for Canada) must provide the project proponent with a single authorization and conditions document. The authorization is defined to include an approval or decision, permit, licence, regulation, or other document that is required by all legislation listed in Schedule 2 to the Building Canada Act.6
Before issuing this authorization document, the Minister must,
- be satisfied that the proponent has taken all measures that the proponent is required to take in respect of each authorization that is specified in the document;
- consult with the minister who is responsible for the enactment under which each authorization is required with respect to the conditions that should be set out in the document;
- undertake a national security review for all state-owned or foreign investments from hostile countries in any national interest project;
- ensure that Indigenous peoples whose rights recognized and affirmed by section 35 of the Constitution Act, 1982 may be adversely affected by the carrying out of the project are consulted; and
- be satisfied that, with regard to any foreign investments in the project, all necessary measures have been taken to protect national security interests.7
A national interest project that is also subject to the Impact Assessment Act is further exempted from certain requirements of that legislation (namely the 180-day planning phase).8
Once issued, the authorization document is deemed to be the authorization that project proponents would otherwise have been required to obtain under various individual statutes.
2. Implementing the Building Canada Act
With respect to next steps, the federal government will proceed to consult with provinces, territories, and Indigenous rights-holders to develop an initial list of national interest projects as defined in the Building Canada Act.9
After consultations, if the Governor in Council is of the opinion that a project may be in the national interest, an Order in Council will add it to the Building Canada Act Schedule of projects.10 Before a project is added to the Schedule of projects, a notice that includes the name and description of the Project will be published in the Canada Gazette for 30 days as an opportunity to enlist feedback.
The federal government has committed to respecting the rights of Indigenous Peoples and ensuring consultation throughout the process of selecting projects of national interest.11 In particular, the Canada Building Act requires that the Minister ensure that the process of consultation with Indigenous peoples whose rights may be negatively affected "allows for the active and meaningful participation of the affected Indigenous peoples" and requires that a report of the consultation process and results be made available within 60 days after issuing the authorization document.12
While the federal government has noted that the intent of the new legislation is to ensure that nation-building projects complete federal review within 2 years,13 only time will tell whether practically, this is achievable.
Footnotes
1. C-5 (45-1) – LEGISinfo – Parliament of Canada.
2. Building Canada Act, S.C. 2025, c. 2, s. 4 at Section 4.
3. ibid at Section 6.
4. ibid at Section 6(1).
5. ibid at Section 6(2).
6. ibid at Section 2.
7. ibid at Section 7(2).
8. ibid at Section 19.
9. Implementation of Bill C-5: One Canadian Economy – Canada.ca.
10. ibid.
11. ibid.
12. Building Canada Act, S.C. 2025, c. 2, s. 4 at Section 7(2.1).
13. Implementation of Bill C-5: One Canadian Economy – Canada.ca.
The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.
© McMillan LLP 2025
