Decision No. 79-W-2017
APPLICATIONS by Rendez-Vous 2017 Tall Ships Regatta (RDV 2017), pursuant to the Coasting Trade Act, S.C., 1992, c. 31, for licences.
[1] Below are the reasons for Decision No. LET-W-30-2017 dated June 15, 2017.
BACKGROUND
[2] RDV 2017 filed numerous coasting trade applications with the Canadian Transportation Agency (Agency) to use foreign registered tall ships to participate in the Canadian portion of RDV 2017. Eleven of these applications are the subject of this Decision.
[3] RDV 2017 is an event organized by Sail Training International that includes port visits in Canada, the United Kingdom, Portugal, Bermuda, the United States of America and France. For the Canadian portion of this event, ships will visit various ports in Atlantic Canada and the Great Lakes before all joining together in Québec. After the Québec visit, some ships will visit other Canadian ports before the tall ship regatta resumes, bound for France.
[4] The operation of activities within Canada for the 11 tall ships pertaining to the subject applications relate to the "ATYLA" (registered in Vanuatu), the "BLUE CLIPPER" (United Kingdom), the "BOWDOIN" (USA), the "DENIS SULLIVAN" (USA), the "GALEON ANDALUCIA" (Spain), the "GERONIMO" (USA), the "JOLIE BRISE" (United Kingdom), the "OOSTERSCHELDE" (Netherlands), the "PICTON CASTLE" (Cook Islands), the "SPIRIT OF SOUTH CAROLINA" (USA) and the "VAHINE" (Finland). Each ship will be carrying trainees during their visit to Canada, which trainees will typically be on board for multiple days, including overnight passages. The tall ship activities all started on June 30 and will end on different dates during the period from July 23 until August 20, 2017, depending on the port visits of each ship.
[5] Agency staff gave notice to the Canadian marine industry of the 11 applications pertaining to these tall ships.
[6] On May 14, 2017, 9109-4631 Québec Inc. filed an objection and offered the "GROSSE ÎLE", a Canadian-registered schooner to provide the service described in the applications. On May 23, 2017, RDV 2017 filed its answer to the offer. On May 24, 2017, 9109 4631 Québec Inc. filed an e-mail indicating that minimal information would be filed the following day. On May 29, 2017, after the close of pleadings, 9109-4631 Québec Inc. filed an additional submission.
PRELIMINARY MATTERS
Combining the applications
[7] Due to the commonality of the issues raised in relation to the 11 applications and the involvement of the same parties, the Agency has decided to combine the multiple applications to consider them in one proceeding.
9109-4631 Québec Inc.'s May 29, 2017 submission
[8] 9109-4631 Québec Inc. filed an additional submission on May 29, 2017, after the close of pleadings on May 25, 2017. 9109-4631 Québec Inc. did not provide any reasons for the late filing.
[9] The coasting trade process provides for an offer, an answer and a reply. While the additional submission was filed after the close of pleadings, the Agency considered that 9109-4631 Québec Inc.'s submission did not provide any new relevant information (along with the fact that 9109 4631 Québec Inc. did not provide any reasons for the late submission). Further, the Agency did not consider that 9109-4631 Québec Inc.'s submission was necessary to complete the file and to allow the Agency to render its decision in this matter.
[10] The Agency finds that 9109-4631 Québec Inc. had sufficient opportunity to file its evidence and had already filed its offer and its reply. As such, 9109-4631 Québec Inc.'s submission, filed after the deadline of May 25, 2017, will not form part of the public record and will not be considered by the Agency in making its decision.
ISSUES
[11] Is there a suitable Canadian ship available to provide the service described in the applications? Is there an identical or similar adequate marine service available from any person operating one or more Canadian ships?
THE LAW
[12] The Coasting Trade Act provides a process to temporarily import a foreign or non-duty paid ship under a coasting trade license when no suitable Canadian-registered duty paid ship is available.
[13] In cases that involve carrying passengers, the Agency must determine whether, on a balance of probabilities, there is a suitable Canadian ship available to provide the service or perform the activity described in the application and whether an identical or similar marine service is available from one or more Canadian ships.
[14] In carrying out its responsibilities, the Agency relies upon an applicant to provide detailed information about all relevant facts and circumstances that are pertinent to a proposed service and to the foreign ship to be used. The Agency also relies upon Canadian operators to provide detailed information about the offered ship and how a Canadian ship that has been offered would be able to meet the requirements, as described by an applicant. The Agency's process is set out in the Canadian Transportation Agency Guidelines Respecting Coasting Trade License Applications (Guidelines).
POSITIONS OF THE PARTIES AND FINDINGS OF FACTS
Position of RDV 2017
[15] RDV 2017 submits in its applications that all ships provide sail and training programs and all are members of the international tall ships community. Ports of call for each individual ship are noted on each application form by date and the port visits cannot be changed because public events are being built around the visits of the ships in the various towns and cities.
[16] RDV 2017 adds that all of the ships applying for coasting trade permits will be carrying trainees during their visit to Canada. Trainees will be on board for varying lengths of time, according to each ship's itinerary and program, and they are typically on board for multiple days, including overnights. Passenger capacity for the 11 tall ships varies from 10 to 43. Depending on the number of trainee berths sold, total number of people on board each ship will vary throughout their visit to Canada.
Position of 9109-4631 Québec Inc.
[17] In response to the Agency staff's notice of applications, 9109-4631 Québec Inc. filed an objection and offered the "GROSSE ÎLE", a Canadian-registered schooner. 9109-4631 Québec Inc. submits that the "GROSSE-ÎLE" can provide the requested service and can carry up to 45 passengers. 9109-4631 Québec Inc. provided a copy of the certificate of registry for the "GROSSE-ÎLE" issued by Transport Canada.
[18] 9109-4631 Québec Inc. states that it was never approached by the organizers of RDV 2017, that the "GROSSE-ÎLE" is approved by Transport Canada to carry passengers, and that its sail training program can be approved as the "ROTER SAND", which is part of the RDV 2017 event, used this sail training program to implement its own training program.
[19] 9109-4631 Québec Inc. states that under Canadian legislation, the "GROSSE-ÎLE" can provide the same service as any of the 11 ships referred to in the notice of applications. According to 9109 4631 Québec Inc., the "GROSSE-ÎLE", previously known as the "HMS GROSSE-ÎLE", is the only original Canadian ship. It is recognized internationally as a historic Canadian ship and is part of European maritime culture, like Sail Training International, one of the organizers of the RDV 2017 event. 9109-4631 Québec Inc. adds that these large gatherings are always "under the banner of history, sailing and the passing on of tradition" in sail training.
[20] 9109-4631 Québec Inc. submits that the "GROSSE-ÎLE" was invited to Brest 2000, which it describes as "the Olympics of this type of gathering", and that it was given a berth and a 150 m2 tent on the berth to represent Canadian and Quebec maritime culture.
[21] 9109-4631 Québec Inc. maintains that the "GROSSE-ÎLE" can meet all the criteria, as well as the criteria related to marine safety, as defined by Transport Canada, specifying that Transport Canada's criteria related to the carrying of passengers are more demanding than those for sail training.
[22] 9109-4631 Québec Inc. adds that the "GROSSE-ÎLE" certainly has a better stability booklet than most ships participating in RDV 2017, with its seven watertight bulkheads, which exceeds the current standard in force by three bulkheads.
RDV 2017's answer
[23] In its answer to the offer, RDV 2017 clarifies that no ships were specifically approached or invited to participate in the event. Instead, applications were welcomed from all interested ships, and notification that the application process was open was communicated through presentations at different industry events, including the joint Sail Training International/Tall Ships America/Canadian Sail Training Association conference in Québec in January 2016. It was also communicated through the Sail Training International and the RDV 2017 websites, and various press conferences and/or publicity by Sail Training International. Applications were accepted from 2012 until March 2017, giving any ship operator five years to apply. RDV 2017 states that all of the Canadian registered ship applicants were accepted and the offeror could simply have contacted the event organizers and asked to participate.
[24] RDV 2017 argues that on Transport Canada's website at http://wwwapps.tc.gc.ca/Saf-Sec-Sur/4/vrqs-srib/eng/vessel-registrations/details/192846, the schooner "GROSSE-ÎLE" is currently registered as a pleasure craft and that it has been unable to confirm whether the current annual inspection allows for carrying passengers. However, RDV 2017 recognizes that the certificate of registry submitted by 9109-4631 Québec Inc. shows that the "GROSSE-ÎLE" is a passenger ship.
[25] Following conversations with Transport Canada, RDV 2017 understands that a license to carry passengers was requested for the ship. RDV 2017 believes that the "GROSSE-ÎLE" is not currently registered to carry passengers/trainees on overnight passages and that it is also not registered as a sail training vessel. All of the 11 ships that 9109-4631 Québec Inc. objects to will be carrying trainees on multi-day sail training voyages, and all have existing established sail training programs.
[26] RDV 2017 submits that the one offered ship, the "GROSSE-ÎLE", is not available to do the work of all 11 listed ships simultaneously. Further, it states that according to the "GROSSE ÎLE" website, the schooner has a full day sailing schedule during the summer of 2017 in Tadoussac, Quebec, with five departures a day, which is incompatible with a full sail training program like what is being provided by the 11 listed ships.
[27] RDV 2017 also states that with its current certification from Transport Canada, the "GROSSE ÎLE" is not technically suitable for doing the work of even one of the 11 ships because it is not currently licensed to take trainees on overnight passages. In addition, although 9109-4631 Québec Inc. states that it has worked with the Canadian sail training vessel "ROTER SAND", RDV 2017 submits that it understands that the "GROSSE-ÎLE" is usually used for day sails and does not have an existing sail training program. In support of this understanding, RDV 2017 refers to http://www.croisieresgrosseile.com/index.asp to show that the ship's usual commercial activity is day sails. RDV 2017 points outs that there is only one ship making day sails as part of RDV 2017, the "EMPIRE SANDY", which is a Canadian-registered ship.
[28] According to RDV 2017, since learning of 9109-4631 Québec Inc.'s objection, RDV 2017 contacted the company to discuss including the "GROSSE-ÎLE" in RDV 2017 in some capacity. RDV 2017 requested that it be sent the ship's specifications and current certificates before deciding how best to include the ship. RDV 2017 indicates that at the time of writing the answer, it had not been provided with this information.
[29] For reasons provided by RDV 2017 regarding the availability and suitability of the "GROSSE ÎLE", in addition to having contacted 9109-4631 Québec Inc. to discuss the possibility of including its ship in RDV 2017 in a way that is consistent with how its ship is licensed, RDV 2017 urges the Agency to rule that the "GROSSE-ÎLE" is not available or suitable to do the required work in place of the 11 listed ships.
9109-4631's reply
[30] In its May 24, 2017 reply, 9109-4631 Québec Inc. states that the applicant's answer is incorrect. 9109-4631 Québec Inc. submits that Transport Canada would not have issued a document (which 9109-4631 Québec Inc. stated that it would file the next day, without having done so) if "GROSSE-ÎLE" was a pleasure craft. 9109-4631 Québec Inc. maintains that once it knows which ship it will be replacing, it will conduct the missing inspection, if applicable.
ANALYSIS AND DETERMINATIONS
[31] In making its findings, the Agency has considered all of the evidence accepted by the Agency during the pleadings.
[32] The Agency will first address the issue of availability, for which the Guidelines provide that when raised during pleadings, the onus is on the applicant to demonstrate that the offered ship is not available.
[33] RDV 2017 argues that the "GROSSE-ÎLE" is not available to do the work of all 11 listed ships simultaneously. RDV 2017 adds that the "GROSSE-ÎLE" website indicates that the schooner has a full day sailing schedule for the summer of 2017 in Tadoussac, which is incompatible with a full sail training program like what is being provided by the 11 listed ships. In considering the above, the Agency finds that RDV 2017 has met its legal burden by providing sufficient evidence to challenge the availability of the "GROSSE-ÎLE".
[34] Where an applicant has submitted evidence to challenge the availability of the offered ship, the evidentiary burden shifts to the offeror to produce evidence to counter the applicant's evidence. As stated in the Guidelines, should the offeror fail to provide sufficient evidence to support its position that the offered ship is suitable and available to perform the proposed work, the Agency will determine that there is no suitable Canadian ship available to perform the activity and, in the case of passenger services, that there is no identical or similar adequate marine service available from any person operating one or more Canadian ships.
[35] The Agency relies upon an offeror of a Canadian registered ship to provide detailed information about the offered ship and how that ship would be able to meet the requirement, as described by an applicant.
[36] In the Agency's opinion, RDV 2017 appears to have made every effort to work within the Guidelines, which provide that where an offer of a Canadian-registered ship is made, the applicant must contact the Canadian offeror(s) to discuss the availability and suitability of the Canadian ship. Learning of 9109-4631 Québec Inc.'s objection, RDV 2017 contacted the company to discuss including the "GROSSE-ÎLE" in RDV 2017 in some capacity and requested that 9109 4631 Québec Inc. send the schooner's specifications and current certificates before deciding how best to include the ship. 9109-4631 Québec Inc. was given an opportunity and yet made no mention of RDV 2017's offer or of the outcome in its reply.
[37] In addition to RDV 2017's recent offer, the Agency notes that 9109-4631 Québec Inc. would have had, like all other participating ships in the RDV 2017, several opportunities over time to contact the organizers of RDV 2017 to explore the possibility of participating in this event.
[38] In complying with the Guidelines and the Coasting Trade Act, the Agency expects the applicant and the offeror to engage in a good faith effort when dealing with each other, providing pertinent and accurate facts in an attempt to resolve the situation, which could possibly lead to a withdrawal of the application or the offer. In all instances, an objection should be made for legitimate and good faith reasons, and never for the purpose of delay.
[39] In this case, the Agency notes that 9109-4631 Québec Inc., like RDV 2017, has been provided with a full opportunity to file submissions in support its position that its schooner is available. The Agency further notes that 9109-4631 Québec Inc. did not file any evidence in its reply to address the issues raised by RDV 2017 regarding the schooner's availability. It simply stated that the applicant's answer was inaccurate, without offering any substantiating evidence. As such, the Agency finds that RDV 2017 has demonstrated that the offered ship is not available to provide the service.
[40] With respect to the suitability, the Agency must determine whether the Canadian ship offered is technically suited to provide the service described in an application. The Agency reiterates that 9109-4631 Québec Inc. did not file evidence in its reply that addressed any of the issues raised by RDV 2017, including whether the "GROSSE-ÎLE" is licensed to take trainees on overnight passages and has an existing sail training program, as is required for each of the 11 ships subject to these applications. Again, 9109-4631 Québec Inc.'s reply was silent in this regard, other than to state that RDV 2017's answer was inaccurate. The Agency therefore finds that RDV 2017 has demonstrated that the offered ship is not suitable to provide the service.
[41] Having found that there is no suitable Canadian ship available to provide the service, there is no need for the Agency to rule on whether there is an identical or similar adequate marine service available from any person operating one or more Canadian ships.
DETERMINATION
[42] The Agency determines, pursuant to subsection 8(1) of the Coasting Trade Act, that there is no suitable Canadian ship available to provide the service.
[43] This Decision takes effect on June 15, 2017, the date on which Decision No. LET-W-30-2017 was issued communicating the Agency's decision in this matter.
Member(s)
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