Section 91(2) of the ''
Constitution Act, 1867
The ''Constitution Act, 1867'' (french: Loi constitutionnelle de 1867),''The Constitution Act, 1867'', 30 & 31 Victoria (U.K.), c. 3, http://canlii.ca/t/ldsw retrieved on 2019-03-14. originally enacted as the ''British North America Act, 186 ...
'', also known as the trade and commerce power, grants the
Parliament of Canada
The Parliament of Canada (french: Parlement du Canada) is the federal legislature of Canada, seated at Parliament Hill in Ottawa, and is composed of three parts: the King, the Senate, and the House of Commons. By constitutional convention, the ...
the authority to legislate on:
The development of
Canadian constitutional law
Canadian constitutional law () is the area of Canadian law relating to the interpretation and application of the Constitution of Canada by the courts. All laws of Canada, both provincial and federal, must conform to the Constitution and any laws i ...
has given this power characteristics that are unique from those that are specified in the United States Constitution's
Commerce Clause
The Commerce Clause describes an enumerated power listed in the United States Constitution ( Article I, Section 8, Clause 3). The clause states that the United States Congress shall have power "to regulate Commerce with foreign Nations, and amon ...
and the Australian Constitution's
interstate trade and commerce power.
Initial jurisprudence
First examined in ''
Citizen's Insurance Co. v. Parsons
''Citizens Insurance Co of Canada v Parsons'' is a major Canadian constitutional case decided by the Judicial Committee of the Privy Council, at that time the highest court of appeal for the British Empire. The case decided a significant issue o ...
'' (1881),
Sir Montague Smith of the
Judicial Committee of the Privy Council
The Judicial Committee of the Privy Council (JCPC) is the highest court of appeal for the Crown Dependencies, the British Overseas Territories, some Commonwealth countries and a few institutions in the United Kingdom. Established on 14 Augus ...
determined its scope thus:
Therefore, ''Parsons'' establishes three basic propositions about the trade and commerce power that have underlined all subsequent jurisprudence:
Initially the scope for extraprovincial trade was set very narrowly by the Privy Council. In the ''
Board of Commerce case'', the Privy Council suggested that the trade and commerce power applied only as an ancillary power to some other valid federal power. This principle was eventually rejected in ''
Toronto Electric Commissioners v. Snider
''Toronto Electric Commissioners v Snider'' is a Canadian constitutional decision of the Judicial Committee of the Privy Council where the Council struck down the federal ''Industrial Disputes Investigation Act'', precursor to the ''Canada Labour C ...
'' and ''
'', but the power was still read strictly.
In ''
R. v. Eastern Terminal Elevator Co.
''R v Eastern Terminal Elevator Co'' is an early constitutional decision of the Supreme Court of Canada on the Constitution's Trade and Commerce power.
Background
The Canada Grain Act was passed in 1912 to control and regulate, through The Board ...
'' (1925), a federal law regulating trade of provincially produced grain destined entirely for export was found not to be within the meaning of extraprovincial trade. As
Duff J. (as he then was) noted in his opinion:
By the 1930s, as noted succinctly in the ''
Fish Canneries Reference
''Canada (AG) v British Columbia (AG)'', also known as the ''Reference as to constitutional validity of certain sections of The Fisheries Act, 1914'' and the ''Fish Canneries Reference'', is a significant decision of the Judicial Committee of the P ...
'' and then subsequently in the ''
Aeronautics Reference'', the division of responsibilities between federal and provincial jurisdictions was summarized as follows by
Lord Sankey
John Sankey, 1st Viscount Sankey, (26 October 1866 – 6 February 1948) was a British lawyer, judge, Labour politician and Lord High Chancellor of Great Britain, famous for many of his judgments in the House of Lords. He gave his name to th ...
:
Murphy v. C.P.R. (1958): Murphy overturns Eastern Terminal Elevators. Change from '25 -’58 is that the Gov of Canada has declared all grain elevators to be working for the "general advantage of Canada." Every Mill and recipient was numbered under S.92 (c) and was taken control of by the Wheat board.
Modern interpretation by the Supreme Court of Canada
With the abolition of appeals to the Privy Council, the interpretation of the power became broader. In ''
Caloil Inc. v. Canada'' (1971) the Court upheld a law prohibiting the movement of imported oil as a form of regulating inter-provincial trade. As noted in the majority judgment by
Pigeon J.:
Provincial jurisdiction over extraprovincial trade and commerce
The Court has also considered the effect of provincial law on the trade and commerce power. In ''
Carnation Co. v. Quebec Agricultural Marketing Board
''Carnation Co v Quebec (Agricultural Marketing Board)'' 968S.C.R. 238 is a leading constitutional decision of the Supreme Court of Canada on the federal authority over trade and commerce under section 91(2) of the ''Constitution Act, 1867''. The ...
'',
Martland J. held that provincial regulations that had an incidental effect on extraprovincial trade were valid:
However, as held in ''
Attorney-General for Manitoba v. Manitoba Egg and Poultry Association et al.'', if the provincial scheme limits the free flow of trade between provinces than it will be struck down. As noted by
Laskin J. (as he then was) in the latter case:
A significant decision with impact on
Canadian federalism
Canadian federalism () involves the current nature and historical development of the federal system in Canada.
Canada is a federation with eleven components: the national Government of Canada and ten provincial governments. All eleven go ...
was made in the ''
Reference re Agricultural Products Marketing Act'' (1978) where the Supreme Court upheld a federal egg marketing scheme that imposed quotas of different provinces. This was a particularly broad interpretation of extraprovincial trade as it included even egg producers who did not export their products. In endorsing the federal-provincial scheme that had been established,
Pigeon J. stated:
There has been discussion as to whether Canadian jurisprudence ought to adopt an approach similar to the
dormant commerce clause
The Dormant Commerce Clause, or Negative Commerce Clause, in American constitutional law, is a legal doctrine that courts in the United States have inferred from the Commerce Clause in Article I of the US Constitution. The primary focus of the d ...
doctrine in the United States, in order to better address conflicts between the federal and provincial jurisdictions.
Modern developments on the general regulation of trade and commerce
In ''
General Motors of Canada Ltd. v. City National Leasing
''General Motors of Canada Ltd v City National Leasing'' is a leading Supreme Court of Canada decision on the scope of the Trade and Commerce power of the Constitution Act, 1867 as well as the interpretation of the Ancillary doctrine.
Backgroun ...
'',
Dickson C.J. listed five indicia of competence for the Parliament of Canada to legislate:
The regulation of general trade must be broad and sweeping, and cannot single out a particular trade or industry. In ''
Labatt Breweries v. Canada'',
Estey J. held that the regulation of the composition of "light beer" under the ''
Food and Drugs Act
The ''Food and Drugs Act'' (the ''Act'') (formal title ''An Act respecting food, drugs, cosmetics and therapeutic devices'') is an act of the Parliament of Canada regarding the production, import, export, transport across provinces and sale of f ...
'' was invalid as it was too narrow to be directed towards trade.
Such post-''General Motors'' analysis is still considered to be vague and problematical in many respects, as it does not lend itself easily to either categorical or balancing styles of analysis.
How a matter becomes one of national concern is governed by the principles stated by
Le Dain J. in ''
R. v. Crown Zellerbach Canada Ltd.
''R v Crown Zellerbach Canada Ltd'' 9881 S.C.R. 401, is a leading constitutional decision of the Supreme Court of Canada. A deeply-divided Court upheld the validity of the Ocean Dumping Act, now part of the Canadian Environmental Protection Act, b ...
'':
The general trade branch was also considered in 2011 in ''
Reference re Securities Act'', where the Court was asked to give its opinion on the Federal Government's proposal to federalize the regulation of the securities industry in Canada. In dismissing the attempt as being unconstitutional as currently drafted,
the Court noted:
Notes
{{Constitution of Canada, confederation
Constitution of Canada
Federalism in Canada