Section 1 (1) definitions of "contractor clause" and "person under contract" BEFORE amended by BC Reg 133/2011, effective July 21, 2011.
"contractor clause" means a provision in
(a) a replaceable tree farm licence that requires timber to be harvested by a person under contract with the holder of the licence, or
(b) a replaceable forest licence under which the regional manager has required that a portion of the timber harvested under the licence be harvested by contractors;
"person under contract" means, for the purposes of Part 6 of this regulation and sections 14 (g) and 35 (1) (j) of the Act, a person who has a contract to provide timber harvesting services under a full contract or a phase contract with the holder of
(a) a replaceable tree farm licence that requires timber to be harvested by a person under contract with the holder of the licence, or
(b) a replaceable forest licence under which the regional manager has required that a portion of the timber harvested under the licence be harvested by contractors
but does not include
(c) a person who is a holder of the licence referred to in paragraph (a) or (b),
(d) a corporation in which more than 10% of the outstanding voting shares are beneficially owned, directly or indirectly
(i) by a person who is a holder of the licence referred to in paragraph (a) or (b), or
(ii) by a person who is the beneficial owner of more than 10% of the outstanding voting shares of a corporation that is the holder of a licence referred to in paragraph (a) or (b), or
(e) a person who is the beneficial owner, directly or indirectly, of more than 10% of the outstanding voting shares of a corporation that is the holder of a licence referred to in paragraph (a) or (b);
Section 1 (1) definition of "coastal area" BEFORE amended by BC Reg 137/2014, effective June 30, 2014.
"coastal area" means the area within one or more timber supply areas or tree farm licences listed below:
| Forest Region | Timber Supply Areas | Tree Farm Licences |
| Coast | Queen Charlotte, Mid-Coast, North Coast Kingcome, Strathcona, Arrowsmith, Sunshine Coast, Soo and Fraser | 6, 10, 19, 24, 25, 26, 37, 38, 39, 43, 44, 45, 46, 47 and 54 |
| Northern Interior | 41 |
Section 1 (1) definition of "peer" BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
"peer" means an individual who is familiar with, and has operational experience with, timber harvesting operations similar to those at issue in a rate dispute, appointed under section 25 (5);
Section 1 (1) definition of "rate proposal" BEFORE repealed by BC Reg 149/2021, effective June 10, 2021.
"rate proposal" means a notice in writing from a licence holder to a contractor with a replaceable contract describing all of the following:
(a) the specific services the licence holder requires the contractor to perform under the replaceable contract;
(b) the replaceable contract in respect of which the proposal is being made;
(c) the rate that the licence holder proposes to pay the contractor for those services;
(d) the estimated quantity of work the licence holder requires the contractor to perform at the proposed rate;
(e) the location where services are to be provided;
(f) the projected start date and completion date for the services;
(g) any other information that is not otherwise available to the contractor, that is in the possession of the licence holder and that is reasonably necessary for the contractor to assess the proposed rate;
Section 1 definition of "phase contribution amount", paragraph (g) BEFORE amended by BC Reg 78/2022, effective March 30, 2022.
(g) if the contract allocates work with reference to a seniority system, the amount of work attributable to each position in the seniority system is
| M/N |
| where | ||
| M | is the amount of work for all positions in the seniority system determined in accordance with paragraphs (c), (d), (e) or (f), as the case may be, and | |
| N | is the number of positions in the seniority system; | |
Section 6 (1) (c) and (d) BEFORE repealed by BC Reg 149/2021, effective June 10, 2021.
(c) if the dispute is a rate dispute, disclosure of fair market rates by either party under section 25,
(d) if the dispute is a rate dispute, capacity for peers to provide information or opinions on fair market rates and on the considerations described in section 26.01 (2),
Section 6 (2) and (3) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(2) Subject to this Part and to sections 23, 25, 25.2, 32, 33.1, 33.43, 33.5 and 33.51, the Commercial Arbitration Act applies to the arbitration of disputes arising under or in connection with a contract or subcontract, and for that purpose the Commercial Arbitration Act is adopted as part of the dispute resolution system under this Part 4.
(3) Except as otherwise provided for in subsection (1) of this section and sections 23, 25, 25.2, 32, 33.1, 33.43, 33.5 and 33.51, the mediation and arbitration of a dispute arising under or in connection with a contract or subcontract will be conducted in accordance with the requirements of section 8.
Section 7 (3) BEFORE amended by BC Reg 133/2011, effective July 21, 2011.
(3) On request, the regional manager must provide to whoever makes the request a copy of the Register of Timber Harvesting Contract and Subcontract Mediators and Arbitrators.
Section 8 (13) (b) (ii) BEFORE amended by BC Reg 153/2010, effective July 1, 2010.
(ii) in the absence of a provision referred to in subparagraph (i), by serving the notice in accordance with the Supreme Court Rules.
Section 8 (1), (2), (3), (5) (part), (6), (7) and (14) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(1) A party to a dispute may commence proceedings under this Division to resolve the dispute by delivering to the other party to the contract or subcontract, and to the Deputy Minister of Forests and Range a notice of dispute specifying the nature of the dispute and requesting mediation and arbitration under this division.
(2) If the parties have not agreed upon a mediator within 14 days of a notice of dispute being delivered as provided for in subsection (1), a party may by written notice to the other party and to the Deputy Minister of Forests and Range request the Deputy Minister of Forests and Range to appoint a mediator.
(3) Within 14 days of receiving a request under subsection (2) to appoint a mediator, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered mediator as mediator.
(5) A party may request the Deputy Minister of Forests and Range to appoint a sole arbitrator if, within 14 days of a notice of arbitration being delivered under subsection (4), either
(6) If the nominees of each party to a 3 person panel have not selected a chairperson of the panel within 28 days of the notice of arbitration being delivered, a party may request the Deputy Minister of Forests and Range to appoint a chairperson.
(7) Within 14 days of receiving a request under subsection (5) or (6) to appoint a sole arbitrator or chairperson, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered arbitrator as sole arbitrator or chairperson.
(14) A person who has acted as a mediator in a dispute may only act as an arbitrator in subsequent arbitration proceedings with respect to that dispute if, after the conclusion of the mediation, all parties agree.
Section 8 (12) (a) and (b) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(a) be administered by the arbitrator or a clerk appointed by the arbitrator, unless the parties to the arbitration otherwise agree, and
(b) except where inconsistent with requirements of this Part, including any rules established by an arbitrator under section 6, be conducted in accordance with the rules of the British Columbia International Commercial Arbitration Centre for the conduct of domestic commercial arbitration, unless the parties to the arbitration agree otherwise.
Section 9 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
Fees and expenses of mediation shared
9 The fees and expenses of the mediator in a mediation, or of a clerk, secretary or reporter assisting in a mediation, must be shared equally between the parties to the dispute, whether or not the mediation leads, without arbitration, to a settlement of the dispute, unless
(a) a party fails or refuses to meet with the mediator or participate in the mediation, in which case the expenses must be borne entirely by that party, or
Section 10.1 (2) (a) BEFORE amended by BC Reg 78/2022, effective March 30, 2022.
(a) the party failed to provide in at timely manner information that was reasonably requested by the arbitrator or by the other party,
Section 11 (1), (2) and (3) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(1) With respect to a dispute arising under or in connection with a contract or subcontract, within 14 days of an arbitrator making an award or giving reasons for an award the sole arbitrator or the chairperson of the arbitration panel must deliver a copy of the award or reasons for the award to the Deputy Minister of Forests and Range.
(2) The Deputy Minister of Forests and Range or person designated by the deputy minister must keep a register to be called the Register of Timber Harvesting Contract and Subcontract Arbitration Awards.
(3) The Deputy Minister of Forests and Range or person designated by the deputy minister must place in the Register of Timber Harvesting Contract and Subcontract Arbitration Awards every copy of an arbitration award or reasons for an arbitration award received under subsection (1).
Section 14 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
Flexibility to address change
14 (1) A replaceable contract must provide that, upon reasonable notice to the contractor, the licence holder may require, for bona fide business and operational reasons, that the contractor
(a) use different timber harvesting methods, technology or silvicultural systems,
(b) move into a new operating area,
(c) comply with different specifications, or
(d) undertake any other operating change necessary to comply with a direction made by a government agency or lawful obligation imposed by any federal, provincial or municipal government.
(2) A replaceable contract must provide that if a requirement made pursuant to subsection (1) results in a substantial change in the timber harvesting services provided by the contractor, the contractor may, within 15 days of receiving notice under subsection (1), elect by notice in writing to the licence holder to terminate the replaceable contract without incurring any liability to the licence holder.
(3) A replaceable contract must provide that, if a requirement is made pursuant to subsection (1) and the contractor does not elect to terminate the replaceable contract as provided for in subsection (2), either party may, within 30 days of the contractor receiving notice under subsection (1), request a review of the rate then in effect.
(4) If, after any changes in timber harvesting services required by the licence holder under subsection (1), the parties are unable to agree upon the rate to be paid for timber harvesting services, a rate dispute is deemed to exist and must be resolved in accordance with Part 5, Division 4.
[am. B.C. Reg. 278/2004, s. 10.]
Section 24.01 definition of "cost of extras" paragraph (a) BEFORE amended by BC Reg 78/2022, effective March 30, 2022.
(a) are not equipment costs, labour costs or administrative and overheard costs,
Section 25 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
Setting rates
25 (1) If a licence holder and a contractor have been unable to agree on rates for work that a licence holder requires a contractor to perform under a replaceable contract,
(a) the licence holder may deliver a rate proposal to the contractor, and
(b) the licence holder must, if requested by the contractor, deliver a rate proposal to the contractor within 15 days of receiving the contractor's request.
(2) A contractor who receives a rate proposal from a licence holder under subsection (1) must, within 15 days of receiving the proposal, deliver a notice in writing to the licence holder either
(a) accepting the rate proposed in the rate proposal, or
(b) rejecting the rate proposed in the rate proposal and offering a rate the contractor believes to be the fair market rate for the work described in the rate proposal.
(3) A contractor who fails to respond to a rate proposal or who responds to the proposal but fails to offer a rate for the work described in the proposal in accordance with subsection (2) is deemed to have accepted the rate proposed by the licence holder in the rate proposal.
(4) A rate dispute is deemed to exist, in respect of a replaceable contract, and the dispute must be resolved by mediation and arbitration under subsection (5) or (6), if the licence holder does not
(a) make a rate proposal under subsection (1) (b), or
(b) within 7 days of receiving a notice under subsection (2) (b) accept the rate offered by the contractor in the notice.
(5) The following applies to a rate dispute referred to in subsection (4) in respect of a replaceable contract pertaining to a licence in the coastal area:
(a) if the parties have not agreed on a mediator within 7 days of a rate dispute being deemed to exist, a party may by written notice to the other party and to the Deputy Minister of Forests and Range request the deputy minister to appoint a mediator;
(b) within 7 days of receiving a request under paragraph (a) to appoint a mediator, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered mediator as mediator;
(c) if requested by the mediator, or if agreed to by the parties, each party must appoint one peer to assist the mediator during the mediation process;
(d) if a party fails or refuses to appoint a peer under paragraph (c) within 7 days of the request by the mediator, the mediator may proceed without the appointment of the peer, or may appoint one;
(e) if a rate dispute is not resolved by mediation within 30 days of a mediator being agreed on by the parties or appointed under paragraph (b), or on earlier written notice by the mediator to the parties that the dispute is not likely to be resolved through mediation, a party may commence arbitration proceedings by delivering a notice of arbitration to the other party and to the mediator;
(f) unless, within 7 days of a notice of arbitration being delivered under paragraph (e), the parties agree on another person to serve as arbitrator, the person agreed to or appointed as mediator must serve as arbitrator;
(g) arbitration proceedings commenced under this Division must be conducted on an expedited basis as follows:
(i) an arbitration hearing must be completed within 30 days of a notice of arbitration being delivered under paragraph (e);
(ii) the arbitrator must deliver an award within 15 days of the arbitration hearing being completed;
(iii) the award must be 5 pages or fewer.
(6) The following apply to a rate dispute referred to in subsection (4) in respect of a replaceable contract pertaining to a licence in the interior area:
(a) if the parties have not agreed on a mediator within 7 days of a rate dispute being deemed to exist, a party may by written notice to the other party and to the Deputy Minister of Forests and Range request the deputy minister to appoint a mediator;
(b) if the parties have not agreed on an arbitrator within 7 days of a rate dispute being deemed to exist, a party may by written notice to the other party and to the Deputy Minister of Forests and Range request the deputy minister to appoint an arbitrator;
(c) within 7 days of receiving a request under paragraph (a) to appoint a mediator, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered mediator as mediator;
(d) within 7 days of receiving a request under paragraph (b) to appoint an arbitrator, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered arbitrator as arbitrator;
(e) within 7 days of the appointment of a mediator, each party must deliver to the other in writing a mediation proposal that outlines the rate for the work described in the rate proposal delivered under subsection (1) and the basis on which they believe that rate is consistent with the criteria set out in section 26.01;
(f) at any time the parties may agree that the mediation proposals required under paragraph (e) are the final offers of the parties for the purposes of paragraphs (h) and (i);
(g) if a rate dispute is not resolved by mediation within 7 days of the parties delivering the mediation proposals required under paragraph (e), or if a party fails to deliver a mediation proposal as required under paragraph (e), or on earlier written notice by the mediator to the parties that the dispute is not likely to be resolved through mediation, a party may commence arbitration proceedings by delivering a notice of arbitration to the other party and to the arbitrator;
(h) within 14 days of the delivery of a notice of arbitration under paragraph (g), each party must deliver to the other and to the arbitrator in writing a final offer that proposes a rate for the work described in the rate proposal delivered under subsection (1) and the basis on which this rate is consistent with the criteria set out in section 26.01;
(i) arbitration proceedings commenced under this Division must be conducted on an expedited basis as follows:
(i) an arbitration hearing must be completed within 7 days of the parties delivering the final offers required under paragraph (g);
(ii) each party is allowed up to one full hearing day to present its final offer;
(iii) the arbitrator must deliver an award within 7 days of the arbitration hearing being completed;
(iv) in delivering the award, the arbitrator must select one of the final offers;
(v) in determining which final offer to select, the arbitrator must select the final offer that proposes the rate the arbitrator believes best reflects the test set out in section 26.01 (1);
(vi) the award must be 5 pages or fewer.
(7) If a rate has been accepted, deemed to have been accepted, resolved or determined by arbitration, the licence holder must make the work described in the rate proposal available to the contractor to perform and the contractor must perform that work in accordance with the rate proposal at the rate that was accepted, deemed to have been accepted or determined.
[en. B.C. Reg. 278/2004, s. 17.]
Section 25.1 (a) and (b) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(a) disclose all rates known to it and described in section 26.01 (2) (a), (b), (c) and (d);
(b) disclose any relevant information known to it that, having regard to the considerations in section 26.01 (2) (e), may be reasonably necessary to make meaningful comparisons between those rates disclosed under paragraph (a) and the rate that is subject to the rate dispute;
Section 25.2 (part) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
Role of peers
25.2 If peers are appointed under section 25 (5) to assist the mediator in a rate dispute,
Section 25.2 (a) and (b) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(a) the peers may provide the mediator with information or opinions with respect to the comparability of any rate as a fair market rate, and the mediator may authorize the peers to perform additional functions,
(b) any information or opinion of a peer with respect to the comparability of a rate as a fair market rate may be considered by an arbitrator in the adjudication of a rate dispute and may be given the weight determined by the arbitrator to be appropriate in the circumstances, and
Section 26 (a) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(a) except as otherwise provided for under this section, the parties must continue to observe their respective rights and obligations under the contract unless both parties agree otherwise,
Section 26.01 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
Rate test
26.01 (1) If a rate dispute is referred to arbitration, the arbitrator must determine the rate according to what a willing licence holder and a willing contractor acting reasonably and at arm's length in similar circumstances would agree is a fair market rate, on the earlier of
(a) the date the rate proposal was delivered to the contractor, and
(b) the date the timber harvesting operations commenced.
(2) In determining a fair market rate under subsection (1), an arbitrator may take into consideration the following:
(a) rates agreed to by the licence holder and contractor for prior timber harvesting services;
(b) rates agreed to under another contract by either the licence holder or contractor for similar timber harvesting services;
(c) rates agreed to under another contract by either the licence holder, the contractor or another person for each phase or component of a similar timber harvesting operation;
(d) rates agreed to by other persons for similar timber harvesting services;
(e) if necessary to make meaningful comparisons to any of the rates agreed to in paragraphs (a), (b), (c) and (d) above, the impact on fair market rates likely to arise from differences between the timber harvesting operations that pertain to the rate in dispute, and the timber harvesting operations that pertain to any rate described in paragraphs (a), (b), (c) and (d), including the following:
(i) differences in operating conditions including, without limitation, differences in terrain, yarding distances, hauling distances, volume of timber per hectare;
(ii) differences in the total amount of timber processed;
(iii) differences in the required equipment configuration;
(iv) differences in required phases;
(v) differences in operating specifications;
(vii) differences in contractual obligations;
(viii) differences in the underlying costs of timber harvesting operations in the forest industry generally which would affect fair market rates, including changes in the cost of labour, fuel, parts and supplies;
(ix) differences in the cost of moving to a new operating area, if any;
(f) any other similar data or criteria that the arbitrator considers relevant.
(3) In determining fair market rates under subsection (1) an arbitrator must not include any consideration or goodwill associated with purchasing a replaceable contract or otherwise acquiring the right to provide timber harvesting services pursuant to a replaceable contract.
(4) In determining a fair market rate under subsection (1), an arbitrator may consider rates for timber harvesting services on land other than Crown land.
[en. B.C. Reg. 278/2004, s. 20.]
Section 26.02 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
Transition
26.02 If a notice of dispute in respect of a rate dispute was delivered under section 8 (1) before the date this section comes into force, that rate dispute will be governed by sections 25 and 26 as they were immediately before that date, unless the parties agree otherwise.
[en. B.C. Reg. 278/2004, s. 20.]
Section 33.1 (8) (e) and (f) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(e) if more than one third of the contractors who are parties to the dispute object under paragraph (c) to the conciliator proposed by the licence holder, or if the licence holder fails to give notice under paragraph (a), any party to the dispute, by written notice to the other parties and to the Deputy Minister of Forests and Range, may request the deputy minister to appoint a conciliator;
(f) within 7 days of receiving a request under paragraph (e) to appoint a conciliator, the Deputy Minister of Forests and Range or a person designated by the deputy minister must appoint a registered mediator or a registered arbitrator to act as conciliator;
Section 38 BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
Other sections applicable to subcontracts
38 Sections 22, 24.1, 25, 25.1, 25.2, 26 and 26.01 apply to replaceable subcontracts, and a reference to a licence holder or contractor or to a licence or contract in those sections, or any standard provision required by those sections, applies to a contractor or subcontractor or to a contract or subcontract as the context requires.
[en. B.C. Reg. 278/2004, s. 27.]
Section 46 BEFORE amended by BC Reg 78/2022, effective March 30, 2022.
Condition on relief — tree farm licences
46 The minister, in granting the relief referred to in section 35 (1) (l) of the Act, must not relieve the holder of a tree farm licence from the provisions of section 35 (1) (l) of the Act unless satisfied that compliance is not feasible in the circumstances.
Section 49 (b) BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
(b) a provision for dispute resolution agreed to by the parties on or after April 1, 1996 that is consistent with the Commercial Arbitration Act, that provides for the use of both mediation and arbitration, and that provides for the appointment of a mediator and, if necessary, an arbitrator within the time frames provided for in section 8.
Section 52 BEFORE amended by BC Reg 149/2021, effective June 10, 2021.
Waiver or amendment of certain requirements of the regulation
52 If, on or after June 21, 2004, a licence holder and a contractor or a contractor and a subcontractor agree in writing, they may waive or amend any of the requirements of sections 6, 8 to 10, 12 to 15, 17 to 26.02, 34 to 38 and those requirements of Part 7 that relate to any of those sections.
[en. B.C. Reg. 278/2004, s. 32.]
Schedule 5 BEFORE re-enacted by BC Reg 149/2021, effective June 10, 2021.
[am. B.C. Regs. 278/2004, s. 34; 524/2004, s. 15.]
(Section 14)
Standard Provision — Changes
1 Subject to section 2, the licence holder may, for bona fide business and operational reasons and on reasonable notice to the contractor, require the contractor to do one or more of the following:
(a) use timber harvesting methods, technology or silviculture systems that are different than those historically used by the contractor under the contract;
(b) move to a new operating area;
(c) comply with different operating specifications;
(d) undertake any other operating change necessary to comply with a direction made by a government agency or lawful obligation imposed by a federal, provincial or municipal government;
and the contractor will comply with the requirements.
2 Despite section 1, if a requirement made by a licence holder under section 1 results in a substantial change in the timber harvesting services provided by the contractor, the contractor may, within 30 days of receiving notice of the requirement, and by written notice to the licence holder, terminate the contract without liability to the licence holder.
3 If a requirement is made under section 1 and the contractor does not elect to terminate this contract under section 2, either party may, within 90 days of the contractor receiving notice under section 1, request a review of the rate then in effect.
4 If either party requests a rate review pursuant to section 3 and the parties are unable to agree upon a new rate, a rate dispute is deemed to exist and must be resolved in accordance with Part 5, Division 4 of the regulation.