Transport Minister Can Grant Innovation Exemptions

Summary#

This Order (registration SI/2020-38) brings Section 215 of the Budget Implementation Act, 2019, No. 1 into force on the day the order is registered. The change lets the Minister of Transport create time-limited exemptions to certain transport laws and rules to allow testing and research that support innovation. The order was made as P.C. 2020-339 on May 18, 2020 and published in the Canada Gazette on June 10, 2020.

What it does#

• Brings into force the parts of the Canada Transportation Act added by Section 215 (new sections 6.6, 6.7 and 6.8).
• Lets the Minister of Transport exempt people, things, or classes of people or things from provisions of an Act or a regulation under the minister’s authority for research, development or testing that promotes innovation and is in the public interest.
• Exemptions can last up to 5 years, and can be extended once for up to an additional 5 years.
• Exemptions can be made subject to conditions (for example, to reduce risks or require data sharing).
• The minister can require extra information from applicants and can recover costs for processing and assessing applications. The minister may refuse to act until costs are paid.
• The minister may refuse to process an application if the applicant owes money to the federal government.
• The Statutory Instruments Act does not apply to exemptions for a single person or thing; those single-person exemptions will normally be made public unless doing so would be inappropriate for safety, security, or confidentiality reasons.

Who's affected#

• Companies and researchers that want to test new transportation technologies or business models (for example, firms working on drones, autonomous vehicles, new rail or marine systems).
• Startups, universities, testing labs, and other innovators in the transportation sector.
• Transport Canada, which will review applications and oversee any conditions attached to exemptions.
• The general public and travellers, who may see tests or pilot projects in their communities or be affected by changes to how services operate.
• The order applies across transportation modes covered by the Canada Transportation Act, so it could affect multiple parts of the transport industry.

Why it matters#

• It creates a clearer legal route for regulated experiments — a formal “regulatory sandbox” — so innovators can test new ideas without being blocked by every existing rule.
• That can speed up development and investment in transportation technology in Canada. It may help bring safety, environmental, or efficiency improvements to market faster.
• At the same time, tests done under exemptions will be managed by the government and can carry conditions, cost recovery, and limits on public disclosure for safety or confidentiality reasons — factors that matter to communities, users, and companies.