HER MAJESTY, by and with the advice and consent of the Legislative Assembly of the Province of British Columbia, enacts as follows:

1 Section 53 (1) of the Forest Act, R.S.B.C. 1996, c. 157, is amended

(a) in the definition of "affiliate" by striking out "within the meaning of subsection (2)" and substituting "within the meaning of section 53.2 (2)",

(b) by repealing the definition of "control of a corporation" and substituting the following:

"control of a corporation" means control of a corporation within the meaning of section 53.2 (1); ,

(c) by repealing the definition of "holder of an agreement",

(d) by adding the following definitions:

"holding corporation" means a holding corporation within the meaning of section 53.2 (4);

"marketing of fibre" means

(a) the acquisition and disposition of rights to harvest timber in British Columbia, and

(b) the buying and selling, within British Columbia, of timber or wood residue;

"related person", in relation to a corporation, means

(a) a person who controls the corporation,

(b) a person who controls a holding corporation whose subsidiary is the corporation, or

(c) an affiliate of the corporation; ,

(e) by repealing the definition of "spouse", and

(f) by adding the following definition:

"subsidiary" means a subsidiary within the meaning of section 53.2 (3).

2 Section 53 is amended

(a) in subsection (1.2) by striking out "Divisions 2 and 4" and substituting "Divisions 2, 2.1 and 4", and

(b) by repealing subsections (2) to (4).

3 The following sections are added to Division 1:

Holders of agreements

53.1  (1) For the purposes of this Part and subject to subsection (2), a person is the holder of an agreement if any of the following applies:

(a) the person has entered into the agreement, whether singly or jointly with one or more other persons;

(b) the person, under section 54.2 (2), became a holder of the agreement on completion of a disposition;

(c) the person is a partner in a partnership that is a person referred to in paragraph (a) or (b) of this subsection.

(2) The government is not to be considered the holder of an agreement for the purposes of this Part.

Corporate relations

53.2  (1) For the purposes of this Part, a corporation is controlled by a person, or a group of persons not dealing with each other at arm's length, if

(a) shares of the corporation are held, other than by way of security only, by or for the benefit of the person or group, as applicable, and

(b) the votes carried by the shares referred to in paragraph (a) are sufficient, if exercised and considered in the aggregate,

(i) to elect or appoint 50% or more of the effective directors of the corporation, or

(ii) to otherwise effectively control the operations and direction of the corporation.

(2) For the purposes of this Part, one corporation is affiliated with another corporation if any of the following apply:

(a) one of them is a subsidiary of the other;

(b) both are subsidiaries of the same holding corporation;

(c) both are controlled by the same person or group of persons;

(d) one of them is controlled by a person or group of persons and the other is a subsidiary of a holding corporation controlled by the same person or group of persons, as applicable;

(e) one of them is a subsidiary of a holding corporation controlled by a person or group of persons and the other is a subsidiary of a different holding corporation controlled by the same person or group of persons, as applicable.

(3) For the purposes of this Part, a corporation is a subsidiary of another corporation if any of the following applies:

(a) the corporation is controlled by the other corporation;

(b) the corporation is controlled by a group comprised of

(i) the other corporation, and

(ii) one or more persons who are not at arm's length from the other corporation, including a corporation that is controlled by the other corporation or by a person who controls the other corporation;

(c) the corporation is a subsidiary of a subsidiary of the other corporation.

(4) For the purposes of this Part, a corporation is the holding corporation of a corporation that is its subsidiary.

4 The heading to Division 2 of Part 4 is repealed and the following substituted:

Division 2 – Dispositions of Agreements .

5 Section 54 (2) is amended

(a) by adding "all of the following conditions have been met:" after "without effect unless",

(b) by repealing paragraph (a) and substituting the following:

(a) the minister, in writing, approves the disposition; ,

(c) in paragraph (c) by striking out "an agreement that is",

(d) by repealing paragraph (d) and substituting the following:

(d) in the case of a disposition of a woodlot licence,

(i) the intended recipient is a person or first nation that, under section 44, may enter into a woodlot licence, and

(ii) the private land, if any, in the woodlot licence area remains subject to the woodlot licence; ,

(e) by adding the following paragraph:

(d.3) in the case of a disposition of a BC timber sales agreement, the intended recipient is registered

(i) as a BC timber sales enterprise, and

(ii) if applicable, in a category of BC timber sales enterprises that, under section 20 (2) (b) (i), was eligible to apply for the agreement; ,

(f) by repealing paragraph (e), and

(g) by repealing paragraph (f) and substituting the following:

(f) the disposition is completed within the longer of the following periods after approval is given by the minister under paragraph (a) of this subsection:

(i) a period specified by the minister in giving the approval;

(ii) a prescribed period, if any.

6 Section 54 is amended by adding the following subsection:

(2.1) On the request of the minister for the purposes of considering whether to approve a disposition, the holder of the agreement or the intended recipient of the agreement must provide to the minister

(a) prescribed information, and

(b) any other information the minister considers necessary.

7 The following sections are added:

Conditions attached to ministerial approval of dispositions

54.01  (1) In this section, "specified agreement" means a specific agreement held by one or both of the following:

(a) the intended recipient of an agreement under a disposition referred to in section 54;

(b) a related person of the intended recipient.

(2) The minister may attach conditions to an approval under section 54 (2) (a).

(3) Without limiting subsection (2), the minister may attach as a condition to an approval under section 54 (2) (a) that one or more specified agreements be disposed of

(a) in accordance with section 54 to a person who is at arm's length from the intended recipient and from the related persons of the intended recipient, if any, and

(b) by a date specified by the minister.

Mandatory refusal of dispositions

54.02  (1) In considering whether to approve a disposition under section 54 (2) (a), the minister must consider the effect of the disposition on

(a) the marketing of fibre in British Columbia, and

(b) the public interest.

(2) Subsection (3) applies if, in considering the matters under subsection (1), the minister considers that any of the following applies:

(a) in the case of a disposition of a tree farm licence, forest licence or pulpwood agreement, the disposition would result in one or more of the following persons, on an individual or aggregate basis, holding or otherwise controlling rights to harvest Crown timber in an amount that is detrimental to competition in the marketing of fibre in all or part of British Columbia:

(i) the intended recipient of the agreement;

(ii) a related person of the intended recipient;

(b) in any case, it would not be in the public interest for the intended recipient to acquire the agreement under the disposition or to hold the rights under the agreement.

(3) In the circumstances referred to in subsection (2), the minister

(a) must not approve the disposition, or

(b) may approve the disposition only if the minister attaches conditions to the approval that will address, to the satisfaction of the minister, the applicable circumstances under subsection (2).

(4) Nothing in this section is intended to limit the authority of the minister to refuse approval of a disposition under section 54 (2) (a).

8 Section 54.1 is repealed.

9 Section 54.2 is amended

(a) in subsection (1) by striking out "On completion of the intended disposition of an agreement referred to in section 54" and substituting "On completing a disposition of an agreement", and

(b) in subsection (2) by striking out "On completion of the intended disposition referred to in section 54" and substituting "On completing a disposition of an agreement".

10 Section 54.3 is repealed and the following substituted:

Dispositions exempt from certain requirements

54.3  (1) In this section, "security interest" means an interest, in an agreement, that secures payment or performance of an obligation.

(2) Sections 54 (2) and 54.2 do not apply to the following dispositions:

(a) the granting, in good faith, of a security interest in an agreement;

(b) the transmission of an interest in an agreement

(i) to a trustee in bankruptcy of the holder of the agreement, or

(ii) from the estate of a deceased holder of an agreement to the deceased holder's personal representative.

(3) Within 3 months after a disposition referred to in subsection (2) (b), the trustee or personal representative referred to in that subsection must provide to the minister written notice of the disposition.

(4) For certainty, subsection (2) (a) does not include a disposition resulting from the enforcement of a security interest.

11 Section 54.4 is amended

(a) in subsection (1) (b) by renumbering subparagraph (i) as subparagraph (i.1) and by adding the following subparagraph:

(i) a non-replaceable forest licence entered into under section 13.1 (5); , and

(b) by adding the following subsections:

(1.3) A disposition approved by the Lieutenant Governor in Council under subsection (1) (b) or (1.01) must be completed within the longer of the following periods after approval is given:

(a) the period specified by the Lieutenant Governor in Council in giving the approval;

(b) if authorized by Lieutenant Governor in Council in giving the approval, a period specified by the minister.

(1.4) The conditions under section 54 (2) (a) and (f) do not apply to a disposition approved by the Lieutenant Governor in Council under subsection (1) (b) or (1.01) of this section.

12 Section 54.5 is repealed.

13 Section 54.6 is amended

(a) by adding the following subsection:

(0.1) In this section, "outstanding liability", in relation to an agreement, means a liability referred to in subsection (1)

(a) accrued or accruing as of the date on which a disposition of the agreement is completed, and

(b) still outstanding as of that date. ,

(b) in subsection (1) by striking out "If a disposition of an agreement is completed in accordance with section 54" and substituting "Subject to subsection (1.1), on completing a disposition of an agreement",

(c) by adding the following subsection:

(1.1) Subsection (1) does not apply to a person who acquires an agreement under a disposition referred to in section 54.3 (2). , and

(d) by repealing subsection (2) and substituting the following:

(2) The following persons, as applicable, continue to be liable, jointly and severally with the person referred to in subsection (1) who acquires an agreement under a disposition, for all outstanding liabilities in relation to the agreement:

(a) the person who disposed of the agreement, other than a trustee in bankruptcy or a personal representative referred to in section 54.3 (2) (b);

(b) a person who held the agreement, if the agreement was disposed of

(i) by the trustee in bankruptcy, referred to in section 54.3 (2) (b) (i), of the person, or

(ii) by the personal representative, referred to in section 54.3 (2) (b) (ii), of the person.

14 The following section is added:

Suspension of rights if condition of disposition not met

54.61  (1) The minister may suspend rights under an agreement under section 76 (1), or under a BC timber sales agreement under section 78.1 (1), if any of the following apply:

(a) the holder purported to dispose of the agreement when a condition set out in section 54 (2) was not met;

(b) the holder purported to dispose of the agreement contrary to section 54.4;

(c) a condition attached under section 54.01 or 54.4 (1.1) to an approval of a disposition of the agreement was not met.

(2) A timber sales manager may take action under section 78 (1) in relation to a BC timber sales agreement if satisfied that any of the circumstances set out in subsection (1) of this section applies to the agreement.

15 The following Division is added after section 54.61:

Division 2.1 – Corporate Changes of Control and Amalgamations

Interpretation

54.62  (1) For the purposes of this Division, control of a corporation that holds an agreement changes if, as a result of an amalgamation or one or more transactions,

(a) control of the corporation changes or is acquired or disposed of, or

(b) control of a holding corporation, whose subsidiary is the corporation, changes or is acquired or disposed of.

(2) For the purposes of this Division, a corporation that holds an agreement amalgamates with another corporation that holds an agreement if the corporation, or a holding corporation whose subsidiary is the corporation, amalgamates with

(a) another corporation that holds an agreement, or

(b) a holding corporation whose subsidiary is a corporation that holds an agreement.

Notice of change of control or amalgamation

54.63  A corporation that holds an agreement must give written notice to the minister of the following events within 30 days after each event:

(a) a change of control of the corporation;

(b) an amalgamation of the corporation with another corporation that holds an agreement.

Review of change of control or amalgamation

54.64  (1) On receiving notice under section 54.63, the minister must

(a) review the change of control or amalgamation, as applicable, and

(b) consider the effects of the change of control or amalgamation, as applicable, on

(i) the marketing of fibre in British Columbia, and

(ii) the public interest.

(2) On the request of the minister for the purposes of a review under subsection (1) (a), the corporation must provide to the minister

(a) prescribed information, and

(b) any other information the minister considers necessary.

Circumstances in which minister may
take administrative action

54.65  The minister may take action under section 54.66 against a corporation that holds an agreement if

(a) control of the corporation changes, or the corporation amalgamates with another corporation that holds an agreement, and

(b) any of the following apply:

(i) immediately after the change of control or amalgamation, all money

(A) required to be paid by the corporation to the government under the circumstances set out in section 130 (1.1), and

(B) due and payable to the government under that section

     in respect of the agreement

(C) has not been paid, and

(D) is not the subject of an arrangement for payment approved by the revenue minister;

(ii) in the case of a change of control or amalgamation of a corporation that holds a BC timber sales agreement, the change of control or amalgamation results in the corporation no longer being registered

(A) as a BC timber sales enterprise, or

(B) if applicable, in a category of BC timber sales enterprises that, under section 20 (2) (b) (i), was eligible to apply for the agreement;

(iii) in the case of a change of control or amalgamation of a corporation that holds a first nations woodland licence, the change of control or amalgamation results in the corporation being a person or entity that, under section 43.54, is not permitted to enter into a first nations woodland licence;

(iv) in the case of a change of control or amalgamation of a corporation that holds a woodlot licence, the change of control or amalgamation results in the corporation being a person who, under section 44, is not permitted to enter into a woodlot licence;

(v) in the case of a change of control or amalgamation of a corporation that holds a tree farm licence, forest licence or pulpwood agreement, the minister considers that the change of control or amalgamation results in one or more of the following persons, on an individual or aggregate basis, holding or otherwise controlling rights to harvest Crown timber in an amount that is detrimental to competition in the marketing of fibre in all or part of British Columbia:

(A) the corporation;

(B) a related person of the corporation;

(vi) the minister considers that, as a result of the change of control or amalgamation, it is not in the public interest for the corporation to continue to hold the agreement or to exercise the rights under the agreement.

Administrative actions following change
of control or amalgamation

54.66  (1) In the circumstances referred to in section 54.65, the minister may

(a) without notice, immediately suspend the rights under the applicable agreement referred to in section 54.65 (b), in whole or in part, and

(b) after giving the corporation an opportunity to be heard, do one or more of the following:

(i) suspend the rights under the agreement, in whole or in part, or confirm or vary a suspension under paragraph (a) of this subsection;

(ii) subject to subsection (3) of this section, require the corporation to dispose of the agreement, in accordance with section 54 and by the date specified by the minister, to a person who is at arm's length from the corporation and from the related persons of the corporation, if any;

(iii) accept a proposal made by the corporation under section 54.67;

(iv) impose other requirements on the corporation.

(2) The minister must reinstate any rights suspended under subsection (1) (a) if the minister does not confirm or vary the suspension after providing an opportunity to be heard under subsection (1) (b).

(3) The minister may not impose a requirement under subsection (1) (b) (ii) if the minister accepts a proposal under subsection (1) (b) (iii).

Proposal by corporation following
administrative action

54.67  (1) In this section, "specified agreement" means a specific agreement held by one or both of the following:

(a) a corporation that has been given an opportunity to be heard under section 54.66 (1);

(b) a related person of the corporation.

(2) For the purposes of addressing a circumstance under section 54.65 (b), a corporation that has been given an opportunity to be heard under section 54.66 (1) may propose to the minister that one or more specified agreements be disposed of.

(3) If the minister accepts a proposal under subsection (2), it is a condition of the minister's acceptance that each specified agreement be disposed of

(a) in accordance with section 54 to a person who is at arm's length from the corporation and from the related persons of the corporation, if any, and

(b) by a date specified by the minister.

(4) The minister must accept a proposal made under subsection (2) if

(a) the minister intends to impose a requirement under section 54.66 (1) (b) (ii) to address circumstances under section 54.65 (b), and

(b) the proposed disposition will address, to the satisfaction of the minister, those circumstances.

Exempt changes of control

54.68  (1) Sections 54.63 to 54.67 do not apply to a change of control of a corporation that is caused by a transmission of shares in its capital

(a) to a trustee in bankruptcy of the holder of the shares, or

(b) from the estate of a deceased person to the deceased person's personal representative.

(2) Within 3 months after a change of control referred to in subsection (1), the corporation must provide to the minister written notice of the change of control.

Subsequent suspension or cancellation of rights

54.69  (1) The minister may suspend rights under an agreement under section 76 (1), or under a BC timber sales agreement under section 78.1 (1), if any of the following apply:

(a) the holder did not dispose of the agreement as required under section 54.66 (1) (b) (ii);

(b) a proposal of the holder was accepted under section 54.66 (1) (b) (iii) by the minister and a condition of the minister's acceptance set out in section 54.67 (3) was not met;

(c) the holder failed to comply with a requirement imposed under section 54.66 (1) (b) (iv).

(2) The minister may cancel an agreement, other than a BC timber sales agreement, under section 77 (1) if

(a) rights under the agreement were suspended, or a suspension of rights under the agreement was confirmed or varied, under section 54.66 (1) (b) (i),

(b) the suspension remains in effect, and

(c) any of the circumstances set out in subsection (1) of this section applies to the agreement.

(3) A timber sales manager may take action under section 78 (1) in relation to a BC timber sales agreement if satisfied that any of the circumstances set out in subsection (1) of this section applies to the agreement.

16 The following Division heading is added after section 54.69:

Division 2.2 – Dispositions of Private Lands Subject to Agreements and Exchanges of Rights .

17 Section 54.7 is amended by adding the following subsection:

(6) This section does not apply to a disposition of private land, or an interest in private land, that is subject to a tree farm licence or woodlot licence if

(a) the licence is disposed of in accordance with section 54, and

(b) the private land or interest in private land, as applicable, is disposed of to the person who acquired the licence under the disposition referred to in paragraph (a) of this subsection.

18 Section 54.8 is repealed.

19 Section 136 is repealed and the following substituted:

Records and returns

136  (1) In this section, "fibre supply arrangement" means a contract or other arrangement for timber or wood residue to be regularly or periodically supplied to

(a) a timber processing facility in British Columbia, or

(b) a prescribed facility in British Columbia.

(2) This section applies to the following persons:

(a) the holder of an agreement under this Act;

(b) a person who harvests timber;

(c) a person who buys or sells timber;

(d) an operator of a timber processing facility;

(e) a party to a fibre supply arrangement;

(f) a prescribed person.

(3) A person referred to in subsection (2) must, in accordance with the regulations, if any, keep accurate records of the following, as applicable to the person:

(a) with respect to timber harvesting,

(i) the volume of timber harvested,

(ii) the nature and extent of silviculture carried out, and

(iii) the costs of each of the following:

(A) timber harvesting;

(B) transporting, by any means, harvested timber;

(C) constructing and maintaining logging roads and bridges;

(D) forest management administration;

(E) silviculture carried out;

(b) with respect to buying or selling timber,

(i) the volumes and prices of timber bought or sold,

(ii) the costs of buying and selling timber, and

(iii) sales information related to timber;

(c) with respect to timber processing facilities,

(i) the volumes of, and prices paid for, timber and wood residue acquired for the facility,

(ii) the volume of timber and wood residue processed at the facility,

(iii) the costs of processing timber and wood residue at the facility,

(iv) the volumes and prices of timber and wood residue distributed from the facility,

(v) sales information related to timber and wood residue produced at the facility, and

(vi) financial statements, prepared in accordance with generally accepted accounting principles;

(d) prescribed information in relation to fibre supply arrangements;

(e) other prescribed information.

(4) A person referred to in subsection (2) must report to the minister, in the form and manner and at the times required by the minister, information recorded under subsection (3).

(5) For the purposes of administering this Act, the following persons may inspect, at any reasonable time, a record kept under subsection (3):

(a) in the case of a record relevant to a BC timber sales agreement, a timber sales manager;

(b) in any case, a person designated by the minister.

20 The following sections are added:

Limits on disclosure of reported information

136.1  (1) Subject to subsection (2), a person employed in the ministry of the minister must not disclose the following information reported under section 136 (4):

(a) information described in section 136 (3) (a) (iii) and (b) to (d);

(b) if specified by regulation, information prescribed under section 136 (3) (e).

(2) Subsection (1) does not apply if the information is disclosed

(a) in accordance with a lawful requirement to disclose the information,

(b) with the consent of the person who reported the information,

(c) as part of a summary that presents the information in such a way that it cannot be connected with the person who reported it,

(d) for the purposes of administering this Act, or for a purpose under this Act, to a minister or a person employed in the government, or

(e) for use in a civil proceeding, administrative proceeding or arbitration that

(i) involves the government, and

(ii) relates to a matter under this Act.

(3) Contravention of subsection (1) is just cause for dismissal.

Information about security interests
held in agreement

136.2  (1) In this section, "security interest" means an interest, in an agreement under this Act, that secures payment or performance of an obligation.

(2) On the request of the minister, a person who holds an agreement under this Act must provide to the minister, at the time specified by the minister, information in relation to any security interests in the agreement.

Information about affiliates of corporate
agreement holders

136.3  (1) In this section, "affiliate" means an affiliate within the meaning of section 53 that is a person referred to in section 136 (2).

(2) On the request of the minister, a corporation that holds an agreement under this Act must provide to the minister, at the time specified by the minister, the following information about each affiliate of the corporation:

(a) the name of the affiliate;

(b) the incorporation number of the affiliate;

(c) the jurisdiction in which the affiliate is incorporated;

(d) prescribed information.

21 Section 151 (2) is amended

(a) by repealing paragraphs (k.11) and (m.1), and

(b) by adding the following paragraph:

(p.2) prescribing information in relation to affiliates that must be provided under section 136.3 (2) (d); .

22 The following sections are added:

Regulation making power in relation to
dispositions of agreements and corporate
changes of control and amalgamations

151.8  The Lieutenant Governor in Council may make regulations respecting the following:

(a) for the purposes of sections 53.2, 54.01 (3), 54.66 (1) and 54.67 (3), respecting the circumstances in which a person is at arm's length from another person;

(b) for the purposes of section 54 (2) (f) (ii), prescribing the period within which a disposition may occur after approval is given;

(c) for the purposes of permitting the disposition of an agreement referred to in section 54.4 (1) (b) or (1.01), respecting

(i) the circumstances in which a disposition may be made,

(ii) the criteria that must be met by the person disposing of the agreement, including, for the purposes of section 54.4 (1.01), the type of processing facility that must be owned or leased by that person,

(iii) the criteria that must be met by the person to whom the agreement is being disposed, including, for the purposes of section 54.4 (1.01), the type of processing facility that must be owned or leased by that person, and

(iv) the provisions that must be included in the agreement being disposed of;

(d) for the purposes of section 54 (2.1) or 54.64 (2), prescribing information that must be provided on the request of the minister, including but not limited to the following information about a corporation that holds an agreement or that is the intended recipient of an agreement:

(i) the names and addresses of the shareholders, directors and officers of the corporation;

(ii) the number of shares of each class or series of shares held by each of the shareholders of the corporation;

(iii) the voting rights held by each class or series of shares of the corporation;

(iv) the identity of each person who has control of the corporation;

(e) for the purposes of section 54.02 (2) (a) or 54.65 (b) (v), respecting how the minister may determine whether a disposition would result, or a change of control or amalgamation results, in persons holding or otherwise controlling rights to harvest Crown timber in an amount that is detrimental to competition in the marketing of fibre, including but not limited to the following:

(i) respecting what constitutes holding or otherwise controlling rights to harvest Crown timber, including providing that a person controls rights to harvest Crown timber if the timber, or wood residue derived from the timber, is supplied to the person under a fibre supply arrangement within the meaning of section 136;

(ii) respecting methods that may be used and factors that may be considered by the minister, including methods and factors that take into account

(A) the concentration of rights to harvest Crown timber, or

(B) the nature and extent of vertical integration of persons engaged in the marketing of fibre;

(iii) specifying different areas in which the marketing of fibre occurs and establishing methods or factors under subparagraph (ii) that may be applied in relation to one or more of those specified areas;

(f) respecting requirements for a corporation that holds an agreement to provide information on the request of the minister for the purposes of

(i) determining whether there has been, within the meaning of section 54.62, a change of control of the corporation or an amalgamation of the corporation with another corporation that holds an agreement, or

(ii) a hearing under section 54.66 (1);

(g) respecting notice under section 54.63, including but not limited to

(i) the manner and form in which notice must be given, and

(ii) additional information that must be provided when giving notice;

(h) limiting the time period within which the minister may take action under section 54.66 after receiving notice of a change of control or amalgamation;

(i) prescribing the time period within which the minister must provide an opportunity to be heard under section 54.66 (1) (b) after suspending an agreement under section 54.66 (1) (a);

(j) exempting a person, disposition, class of persons or class of dispositions from one or more of the provisions of sections 54 (2), 54.2 and 54.6;

(k) exempting a corporation or class of corporations from sections 56.63 to 54.67;

(l) for the purposes of an exemption under paragraph (j) or (k), making regulations that do one or more of the following:

(i) establish circumstances in which the exemption applies;

(ii) set conditions of, or limitations on, the application of the exemption.

Regulation making power in relation to
records and returns

151.9  The Lieutenant Governor in Council may make regulations respecting the following:

(a) for the purposes of the definition of "fibre supply arrangement" in section 136, prescribing facilities, including but not limited to

(i) facilities that manufacture products from timber or wood residue, and

(ii) facilities that produce bioenergy;

(b) for the purposes of section 136 (2) (f), prescribing persons or classes of persons

(i) who acquire, distribute, buy or sell timber, wood residue, products manufactured from timber or wood residue or rights to harvest Crown timber, or

(ii) who process timber or wood residue,

including but not limited to

(iii) persons who transport timber, wood residue or products manufactured from timber or wood residue,

(iv) operators of facilities that manufacture products from timber or wood residue, and

(v) operators of facilities that produce bioenergy;

(c) for the purposes of section 136 (3), establishing requirements respecting the keeping of records under that section, including but not limited to

(i) establishing categories or subcategories of information,

(ii) requiring that records be kept according to categories or subcategories established under subparagraph (i),

(iii) requiring that records be kept in relation to particular periods, or

(iv) requiring that specific information or types of information be recorded;

(d) for the purposes of section 136 (3) (d), prescribing information in relation to fibre supply arrangements, including but not limited to information respecting

(i) the parties to, and term of, the arrangement,

(ii) the recipients and intended recipients of timber or wood residue supplied under the arrangement, or

(iii) the actual and agreed-on volumes and prices of timber or wood residue supplied under the arrangement;

(e) for the purposes of section 136 (3) (e), prescribing information in relation to

(i) the acquiring, distributing, buying or selling of timber, wood residue, products manufactured from timber or wood residue or rights to harvest Crown timber, or

(ii) the processing of timber or wood residue,

including but not limited to information respecting

(iii) the transporting of timber, wood residue or products manufactured from timber or wood residue,

(iv) the manufacturing of products from timber or wood residue, and

(v) the producing of bioenergy;

(f) for the purposes of section 136.1, specifying information prescribed for the purposes of section 136 (3) (e) that must not be disclosed.

23 Section 163 is amended

(a) in subsection (2) by striking out "136 (1) or (1.1)" and substituting "136 (3) or (4)", and

(b) in subsection (6) by striking out "section 136 (3)" and substituting "section 136.1 (1)".

Forest Act transition – dispositions of agreements

24  (1) In this section, "specified provisions" means sections 54 and 54.1 of the Forest Act, as they read immediately before the coming into force of sections 6 and 8 of this Act.

(2) The specified provisions continue to apply to a disposition of an agreement if a written notice of the intended disposition was given to the minister

(a) in accordance with section 54 (2) (a) of the Forest Act, as it read immediately before the coming into force of section 6 of this Act, and

(b) before the date this Act received First Reading in the Legislative Assembly.

(3) Subsection (2) applies despite

(a) the amendment by this Act of section 54 of the Forest Act, and

(b) the repeal by this Act of section 54.1 of the Forest Act.

(4) Subject to subsection (5),

(a) section 54 of the Forest Act, as amended by this Act, and

(b) sections 54.01 and 54.02 of the Forest Act, as added by this Act,

apply to a disposition of an agreement other than a disposition referred to in subsection (2) of this section.

(5) Sections 54 to 54.02 of the Forest Act do not apply to a disposition of an agreement referred to in subsection (4) of this section if another provision under that Act provides that those sections do not apply.

Forest Act transition – changes of control and
amalgamations of corporate agreement holders

25  (1) Section 54.5 of the Forest Act, as it read immediately before the coming into force of section 12 of this Act, continues to apply to a change of control, disposition of control or acquisition of control referred to in that section if the change of control, disposition of control or acquisition of control occurred before the date this Act received First Reading in the Legislative Assembly.

(2) Subsection (1) applies despite the repeal by this Act of section 54.5 of the Forest Act.

(3) Division 2.1 of Part 4 of the Forest Act applies to any of the following events that occur on or after the date this Act received First Reading in the Legislative Assembly:

(a) a change of control of a corporation that holds an agreement, within the meaning of section 54.62 (1) of the Forest Act;

(b) an amalgamation of a corporation that holds an agreement with another corporation that holds an agreement, within the meaning of section 54.62 (2) of the Forest Act.

Forest Act transition – notice of change of
control or amalgamation

26  (1) This section applies to a corporation that holds an agreement if, on or after the date this Act received First Reading in the Legislative Assembly and before the date this Act received Royal Assent, either of the following events occurs:

(a) control of the corporation changes, within the meaning of section 54.62 (1) of the Forest Act;

(b) the corporation amalgamates with another corporation that holds an agreement, within the meaning of section 54.62 (2) of the Forest Act.

(2) Despite section 54.63 of the Forest Act and in the circumstances referred to in subsection (1) of this section, the corporation must provide notice of the change of control or amalgamation to the minister within 30 days after the date this Act received Royal Assent.

(3) For the purposes of section 76 (1) (d) of the Forest Act, the holder of an agreement, other than a BC timber sales agreement, fails to comply with the Forest Act if the holder fails to comply with subsection (2) of this section.

(4) For the purposes of sections 78 (2) (c) and 78.1 (1) (b) of the Forest Act, a person has not complied with the Forest Act if the person has not complied with subsection (2) of this section.

Forest Act transition – regulations

27  For the purposes of sections 24 and 25, the Lieutenant Governor in Council may make regulations respecting what constitutes unduly restricting competition in section 54.1 or 54.5 of the Forest Act, as they read immediately before the coming into force of sections 8 and 12 of this Act, including methods to be used, and factors to be taken into account, in making a determination under section 54.1 (a) or 54.5 (1) (b) (ii).

Commencement

28  This Act comes into force on the date of Royal Assent.

 
Explanatory Notes

SECTION 1: [Forest Act, section 53]

• amends definitions of "affiliate" and "control of a corporation";
• adds definitions of "holding corporation", "marketing of fibre", "related person" and "subsidiary";
• repeals definitions of "holder of an agreement" and "spouse".

SECTION 2: [Forest Act, section 53]

• provides, for the purposes of Division 2.1 of Part 4 of the Act, as added by this Bill, that the definition of "agreement" includes a pulpwood agreement;
• repeals subsections (2) to (4).

SECTION 3: [Forest Act, sections 53.1 and 53.2]

• describes who is a holder of an agreement for the purposes of Part 4 of the Act;
• describes relations between corporations for the purposes of Part 4 of the Act.

SECTION 4: [Forest Act, heading to Division 2 of Part 4] amends a Division heading consequential to amendments made by this Bill to the Act.

SECTION 5: [Forest Act, section 54]

• provides that a disposition of an agreement is without effect unless
• the minister approves of the disposition, and
• the disposition is completed by the date specified by the minister or the date prescribed by regulation, whichever is later;
• provides that a disposition of a woodlot licence is without effect unless the intended recipient is a person or first nation that may enter into a woodlot licence;
• provides that a disposition of a BC timber sales agreement is without effect unless the intended recipient is registered as a BC timber sales enterprise and, if applicable, in a category of BC timber sales enterprises that was eligible to apply for the agreement.

SECTION 6: [Forest Act, section 54] provides that, on the request of the minister for the purposes of considering whether to approve a disposition, the holder of an agreement or the intended recipient of the agreement must provide certain information to the minister.

SECTION 7: [Forest Act, sections 54.01 and 54.02]

• provides authority for the minister to attach conditions to an approval of a disposition;
• requires that, in considering whether to approve a disposition, the minister must consider the effect of the disposition on the marketing of fibre in British Columbia and on the public interest;
• provides that, in certain circumstances, the minister either must refuse to approve a disposition or may approve a disposition only if conditions are attached to the approval of the disposition that will address those circumstances.

SECTION 8: [Forest Act, section 54.1] repeals the section consequential to amendments made by this Bill to the Act.

SECTION 9: [Forest Act, section 54.2] is consequential to amendments made by this Bill to the Act.

SECTION 10: [Forest Act, section 54.3] clarifies the intention of the section.

SECTION 11: [Forest Act, section 54.4]

• sets limits on the dispositions of non-replaceable forest licences under section 13.1 (5) of the Act;
• provides that a disposition approved by the Lieutenant Governor in Council must be completed within the period specified by the Lieutenant Governor in Council or, if authorized by the Lieutenant Governor in Council, a period specified by the minister.

SECTION 12: [Forest Act, section 54.5] repeals the section consequential to amendments made by this Bill to the Act.

SECTION 13: [Forest Act, section 54.6]

• provides that section 54.6 (1) does not apply to a person who acquires an agreement through a disposition referred to in section 54.3 (2);
• provides that certain persons continue to be liable for outstanding liabilities in relation to an agreement after the agreement is disposed of.

SECTION 14: [Forest Act, section 54.61] authorizes the minister to suspend rights under an agreement under section 76 (1) or 78.1 (1), and a timber sales manager to take action under section 78 (1), if certain circumstances apply.

SECTION 15: [Forest Act, Division 2.1 of Part 4]

• adds a new Division to Part 4 of the Act;
• describes what constitutes, for the purposes of the Division,
• a change of control of a corporation that holds an agreement, and
• an amalgamation of a corporation that holds an agreement with another corporation that holds an agreement;
• requires a corporation to provide notice to the minister within 30 days after a change of control of the corporation or an amalgamation of the corporation with another corporation that holds an agreement;
• requires the minister to review the effect of a change of control or amalgamation on the marketing of fibre in British Columbia and on the public interest;
• requires a corporation that holds an agreement to provide certain information to the minister on the minister's request, for the purposes of reviewing a change of control or amalgamation;
• authorizes the minister to take certain administrative actions against a corporation that holds an agreement if there is a change of control of the corporation, or the corporation amalgamates with another corporation that holds an agreement, and certain circumstances apply;
• establishes exemptions from the application of the Division;
• authorizes the minister to suspend or cancel an agreement held by a corporation in certain circumstances.

SECTION 16: [Forest Act, heading to Division 2.2 of Part 4] adds a new heading to Part 4 of the Act, consequential to amendments made by this Bill to the Act.

SECTION 17: [Forest Act, section 54.7] adds an exception to the restriction on the disposal of private land that is subject to a tree farm licence or woodlot licence.

SECTION 18: [Forest Act, section 54.8] repeals the section consequential to amendments made by this Bill to the Act.

SECTION 19: [Forest Act, section 136] adds requirements respecting the keeping of records and the reporting of information required to be kept.

SECTION 20: [Forest Act, sections 136.1 to 136.3]

• establishes limits on the disclosure of certain information reported under section 136 of the Act and provides exceptions to those limits;
• requires agreement holders to, on the request of the minister, provide to the minister information in relation to security interests in those agreements;
• requires corporations that hold agreements to, on the request of the minister, provide to the minister certain information about certain affiliates of the corporation.

SECTION 21: [Forest Act, section 151] authorizes the Lieutenant Governor in Council to make regulations in relation to sections of the Act amended by this Bill.

SECTION 22: [Forest Act, sections 151.8 and 151.9]

• authorizes the Lieutenant Governor in Council to make regulations in relation to dispositions of agreements, changes of control of corporations that hold agreements and amalgamations of corporations that hold agreements;
• authorizes the Lieutenant Governor in Council to make regulations respecting the recording of information under section 136 as amended by this Bill and types of information that must not be disclosed under section 136.1 as added by this Bill.

SECTION 23: [Forest Act, section 163] is consequential to amendments made by this Bill to the Act.

SECTION 24: [Forest Act transition – dispositions of agreements]

• provides that section 54 of the Act, as it read before being amended by this Bill, and section 54.1 of the Act, as it read before being repealed by this Bill, apply to a disposition of an agreement if a notice of the disposition was given to the minister in accordance with section 54 (2) before the date this Bill receives First Reading in the Legislative Assembly;
• clarifies that section 54 of the Act, as amended by this Bill, and sections 54.01 and 54.02, as added by this Bill, apply to all other dispositions of agreements.

SECTION 25: [Forest Act transition – changes of control and amalgamations of corporate agreement holders]

• provides that section 54.5 of the Act, as it read before being repealed by this Bill, applies to a change of control of a corporation that occurred before the date this Bill receives First Reading in the Legislative Assembly;
• clarifies that Division 2.1 of Part 4 of the Act, as added by this Bill, applies to the change of control of a corporation that holds an agreement, or an amalgamation of a corporation that holds an agreement with another corporation that holds an agreement, if the change of control or amalgamation occurs on or after the date this Bill receives First Reading in the Legislative Assembly.

SECTION 26: [Forest Act transition – notice of change of control or amalgamation] establishes notice requirements for corporations that hold an agreement, if a change of control of the corporation occurs, or if the corporation amalgamates with another corporation that holds an agreement, on or after the date this Bill receives First Reading in the Legislative Assembly and before the date this Bill receives Royal Assent.

SECTION 27: [Forest Act transition – regulations] authorizes the Lieutenant Governor in Council to make regulations respecting what constitutes unduly restricting competition in sections 54.1 or 54.5 of the Forest Act, as they read before being repealed by this Bill.