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This Act is current to February 27, 2024
See the Tables of Legislative Changes for this Act’s legislative history, including any changes not in force.

Forest Act

[RSBC 1996] CHAPTER 157

Part 16 — Compensation in Relation to Special Purpose Areas

Division 1 — Definitions and Interpretation for Part 16

Definitions for Part 16

226   (1) In this Part:

"deletion for a non-timber production purpose" means a deletion under Division 3 [Impacts and Restrictions on Area-Based Licences and Timber Licenses] of Part 15 [Special Purpose Areas] of Crown land from the licence area of an area-based licence or non-TFL timber licence, if the deletion occurs in connection with an area that is designated as a special purpose area for a non-timber production purpose;

"deletion for an access purpose" means a deletion under Division 3 of Part 15 of Crown land from the licence area of an area-based licence or non-TFL timber licence, if the deletion occurs in connection with an area that is designated as a special purpose area for an access purpose;

"deletion for other special purposes" means a deletion under Division 3 of Part 15 of Crown land from the licence area of an area-based licence or non-TFL timber licence, if the deletion occurs in connection with an area that is designated as a special purpose area for one or more of the purposes referred to in section 182 [designation for first nation purpose, BCTS licence purpose or community forest agreement purpose];

"deletion period" has the meaning set out in section 227 [meaning of "deletion period"];

"established practices" means practices that

(a) have been carried out previously in relation to the harvest and sale of a volume of timber that is harvested from the relevant harvest profile, and

(b) are evidenced by records that

(i) have been submitted previously under this Act, and

(ii) are considered relevant by the minister;

"net income" means the amount determined in accordance with section 228 [meaning of "net income"];

"original allowable annual cut" means the following:

(a) in relation to an area-based licence, the allowable annual cut for the licence area of the area-based licence at the beginning of a deletion period;

(b) in relation to a forest licence, the allowable annual cut of the forest licence at the beginning of a deletion period;

"original licence area", in relation to a non-TFL timber licence, means the licence area of the non-TFL timber licence at that time the licence was first entered into;

"reduction for a non-timber production purpose" means a reduction under section 202 [reduction to forest licences following designation as special purpose area] to the allowable annual cut of a forest licence, if the reduction is made in connection with an area that is designated as a special purpose area for a non-timber production purpose;

"reduction for an access purpose" means a reduction under section 202 to the allowable annual cut of a forest licence, if the reduction is made in connection with an area that is designated as a special purpose area for an access purpose;

"reduction for other special purposes" means a reduction under section 202 to the allowable annual cut of a forest licence, if the reduction is made in connection with an area that is designated as a special purpose area for one or more of the purposes referred to in section 182;

"relevant harvest profile" means the following:

(a) in relation to the licence area of an area-based licence,

(i) the harvest profile for the licence area, as specified under section 185 (1) (a) [impacts on harvest profile and AAC of area-based licence], or

(ii) if impacts to that harvest profile are specified under section 185 (1) (e), the impacted harvest profile specified under that section;

(b) in relation to the licence area of a non-TFL timber licence, the harvest profile for the portion of the licence area that overlaps a special purpose area, as specified under section 186 (1) (a) [impacts on non-TFL timber licence];

(c) in relation to the volume-based portion of a timber supply area,

(i) the harvest profile for the volume-based portion, as specified under section 199 (1) (a) [impacts on harvest profile and AAC of timber supply area], or

(ii) if impacts to that harvest profile are specified under section 199 (1) (e), the impacted harvest profile specified under that section;

"remaining term" has the meaning set out in section 229 [meaning of "remaining term"].

(2) If a word or expression used in this Part is defined in section 180 [definitions for Part 15], the word or expression has the same meaning as defined in that section.

Meaning of "deletion period"

227   (1) The deletion period for a forest licence, and for replacements for the forest licence, is each successive 15-year period, commencing with the beginning of the term of the original forest licence.

(2) The deletion period for a tree farm licence, and for replacements for the tree farm licence, is each successive 25-year period, commencing with the beginning of the term of the original tree farm licence.

(3) The deletion period for a community forest agreement, and for replacements for the community forest agreement, is each successive 25-year period, commencing with the beginning of the term of the following, as applicable:

(a) unless paragraph (b) applies, the original community forest agreement;

(b) if the original community forest agreement is a probationary community forest agreement, the original probationary community forest agreement.

(4) The deletion period for a first nations woodland licence, and for replacements for the first nations woodland licence, is each successive 25-year period, commencing with the beginning of the term of the original first nations woodland licence.

(5) The deletion period for a woodlot licence, and for replacements for the woodlot licence, is each successive 15-year period, commencing with the beginning of the term of the original woodlot licence.

(6) For the purposes of this section, an agreement or licence is the original if the agreement or licence

(a) does not replace a previous agreement or licence, or

(b) is not a licence entered into under

(i) section 19 [consolidation and subdivision of forest licences],

(ii) section 39 [consolidation and subdivision of tree farm licences], or

(iii) section 46.2 [consolidation of woodlot licences].

Meaning of "net income"

228   (1) Net income, in relation to the harvest and sale of a volume of timber, is the amount determined by the following formula and in accordance with the regulations, if any:

net income = revenues − costs
where
revenues=the revenues that would be received from the sale of the portion of the harvested volume of timber that would be sold at market;
costs=the costs, including the costs specified under subsection (2), that would be associated with
(a) the harvest of the volume of timber, and
(b) the sale of the portion of the harvested volume of timber that would be sold at market.

(2) For the purposes of the formula under subsection (1), the costs include the following:

(a) stumpage that would be payable to the government;

(b) planning, administrative and overhead costs that would be attributed to the harvest and sale of the timber;

(c) costs in respect of the following matters that would be associated with the harvest and sale of the timber:

(i) constructing, maintaining and deactivating roads;

(ii) felling, de-limbing and bucking timber;

(iii) yarding and loading timber;

(iv) transporting timber;

(v) sorting and scaling timber;

(vi) log booming;

(vii) any additional loading and unloading of timber in relation to sorting and scaling timber, log booming, or transporting the timber to market by any means;

(d) costs that would be incurred to fulfill an obligation or requirement, including a silviculture or other forest management obligation or requirement, that would be

(i) associated with the harvest of the timber, and

(ii) imposed under this Act, the Forest and Range Practices Act or the Wildfire Act;

(e) export fees and brokerage fees that would be incurred;

(f) any other costs that the minister determines would be incurred to bring the timber to market.

Meaning of "remaining term"

229   (1) The remaining term of an area-based licence or non-TFL timber licence, in relation to the deletion of Crown land from the licence area as a result of the designation of an area as a special purpose area, is the period that

(a) starts on the date the Crown land is deleted from the licence area under Division 3 [Impacts and Restrictions on Area-Based Licences and Timber Licences] of Part 15 [Special Purpose Areas], and

(b) ends on the expiry date of the term of the licence as at the effective date of the designation.

(2) The remaining term of a forest licence, in relation to the designation of an area as a special purpose area, is the period that

(a) starts on the date the allowable annual cut of the licence is reduced under section 202 [reduction to forest licences following designation as special purpose area] as a result of the designation, and

(b) ends on the expiry date of the term of the licence as at the effective date of the designation.

Division 2 — Compensation for Area-Based Licences and Non-TFL Timber Licences

Definitions for Division 2 of Part 16

230   In this Division:

"total compensable AAC" means the following:

(a) for the purposes of determining the compensation to which the holder of an area-based licence is entitled under section 231 [compensation for area-based licence for deletion for access purpose], the amount by which the allowable annual cut reduction referred to in subsection (1) (b) of that section exceeds 5% of the original allowable annual cut of the licence;

(b) for the purposes of determining the compensation to which the holder of an area-based licence is entitled under section 232 [compensation for area-based licence for deletion for non-timber production purpose], the amount by which the allowable annual cut reduction referred to in subsection (1) (b) of that section exceeds 5% of the original allowable annual cut of the licence;

"total compensable area" means the following:

(a) for the purposes of determining the compensation to which the holder of a non-TFL timber licence is entitled under section 234 [compensation for non-TFL timber licence for deletion for access purpose], the amount by which the licence area reduction referred to in subsection (1) (b) of that section exceeds 5% of the original licence area;

(b) for the purposes of determining the compensation to which the holder of a non-TFL timber licence is entitled under section 235 [compensation for non-TFL timber licence for deletion for non-timber production purpose], the amount by which the licence area reduction referred to in subsection (1) (b) of that section exceeds 5% of the original licence area.

Compensation for area-based licence for deletion for access purpose

231   (1) The holder of an area-based licence is entitled to compensation if

(a) the allowable annual cut of the licence is reduced as a result of a particular deletion for an access purpose, and

(b) as a result of the particular deletion and, if applicable, one or more previous deletions for an access purpose, the allowable annual cut of the licence is reduced, during the deletion period, by an amount that exceeds 5% of the original allowable annual cut.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of an area-based licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the volume of the harvested timber were equal to that portion of the total compensable AAC that the minister determines is attributable to the particular deletion referred to in subsection (1) (a),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for area-based licence for deletion for non-timber production purpose

232   (1) The holder of an area-based licence is entitled to compensation if

(a) the allowable annual cut of the licence is reduced as a result of a particular deletion for a non-timber production purpose, and

(b) as a result of the particular deletion and, if applicable, one or more previous deletions for a non-timber production purpose, the allowable annual cut of the licence is reduced, during the deletion period, by an amount that exceeds 5% of the original allowable annual cut.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of an area-based licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the volume of the harvested timber were equal to that portion of the total compensable AAC that is attributable to the particular deletion referred to in subsection (1) (a),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for area-based licence for deletion for other special purposes

233   (1) The holder of an area-based licence is entitled to compensation if the allowable annual cut for the licence area is reduced as a result of a particular deletion for other special purposes.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of an area-based licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the volume of the harvested timber were equal to the amount by which the allowable annual cut of the licence is reduced as a result of the particular deletion referred to in subsection (1),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for non-TFL timber licence for deletion for access purpose

234   (1) The holder of a non-TFL timber licence is entitled to compensation if

(a) a portion of the licence area is deleted as a result of a particular deletion for an access purpose, and

(b) as a result of the particular deletion and, if applicable, one or more previous deletions for an access purpose, the licence area is reduced by an amount that exceeds 5% of the original licence area.

(2) Subject to the adjustments under subsection (4), the compensation to which the holder of a non-TFL timber licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the size of the area from which the timber were harvested were equal to the size of the area that

(i) is deleted as a result of the particular deletion referred to in subsection (1) (a), as determined by the chief forester under section 186 (1) (b) [impacts on non-TFL timber licence], and

(ii) is in that portion of the total compensable area that the minister determines is attributable to that particular deletion,

(b) the volume of the harvested timber were equal to the amount calculated by using the formula set out in subsection (3),

(c) the timber were harvested from the relevant harvest profile, and

(d) the timber were harvested and sold in accordance with established practices.

(3) The formula for the purposes of subsection (2) (b) is as follows:

volume =size of deleted area × average volume per ha

remaining years
where
size of deleted area=the size, in hectares, of the area described in subsection (2) (a);
average volume per ha=the average volume of timber, per hectare, in the area of overlap that is deleted from the licence area, as determined by the chief forester under section 186 (1) (c) [impacts on non-TFL timber licence];
remaining years=the number of years in the remaining term of the licence.

(4) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for non-TFL timber licence for deletion for non-timber production purpose

235   (1) The holder of a non-TFL timber licence is entitled to compensation if

(a) a portion of the licence area is deleted as a result of a particular deletion for a non-timber production purpose, and

(b) as a result of the particular deletion and, if applicable, one or more previous deletions for a non-timber production purpose, the licence area is reduced by an amount that exceeds 5% of the original licence area.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of a non-TFL timber licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the size of the area from which the timber were harvested were equal to the size of the area that

(i) is deleted as a result of the particular deletion referred to in subsection (1) (a), as determined by the chief forester under section 186 (1) (b) [impacts on non-TFL timber licence], and

(ii) is in that portion of the total compensable area that the minister determines is attributable to that particular deletion,

(b) the volume of the harvested timber were equal to the amount calculated by using the formula set out in section 234 (3),

(c) the timber were harvested from the relevant harvest profile, and

(d) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for non-TFL timber licence for deletion for other special purposes

236   (1) The holder of a non-TFL timber licence is entitled to compensation if a portion of the licence area is deleted as a result of a particular deletion for other special purposes.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of a non-TFL timber licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of harvested timber if, during each year of the remaining term of the licence,

(a) the size of the area from which the timber were harvested were equal to the size of the area that is deleted as a result of the particular deletion referred to in subsection (1), as determined by the chief forester under section 186 (1) (b) [impacts on non-TFL timber licence],

(b) the volume of the harvested timber were equal to the amount calculated by using the formula set out in section 234 (3) [compensation for non-TFL timber licence for deletion for access purpose] and, for this purpose, the size of the deleted area is the size, in hectares, of the area referred to in paragraph (a) of this subsection,

(c) the timber were harvested from the relevant harvest profile, and

(d) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Division 3 — Compensation for Forest Licences

Definition for Division 3 of Part 16

237   In this Division, "total compensable AAC" means the following:

(a) for the purposes of determining the compensation to which the holder of a forest licence is entitled under section 238 [compensation for forest licence for reduction for access purpose], the amount by which the allowable annual cut reductions referred to in subsection (1) (b) of that section exceed 5% of the original allowable annual cut of the licence;

(b) for the purposes of determining the compensation to which the holder of a forest licence is entitled under section 239 [compensation for forest licence for reduction for non-timber production purpose], the amount by which the allowable annual cut reductions referred to in subsection  (1) (b) of that section exceed 5% of the original allowable annual cut of the licence.

Compensation for forest licence for reduction for access purpose

238   (1) The holder of a forest licence is entitled to compensation if

(a) the allowable annual cut of the licence is reduced as a result of a particular reduction for an access purpose, and

(b) as a result of the particular reduction and, if applicable, one or more previous reductions for an access purpose, the allowable annual cut of the licence is reduced, during the deletion period, by an amount that exceeds 5% of the original allowable annual cut.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of a forest licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of timber that would be harvested if, during each year of the remaining term of the licence,

(a) the volume of timber harvested were equal to that portion of the total compensable AAC that is attributable to the particular reduction referred to in subsection (1) (a),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for forest licence for reduction for non-timber production purpose

239   (1) The holder of a forest licence is entitled to compensation if

(a) the allowable annual cut of the licence is reduced as a result of a particular reduction for a non-timber production purpose, and

(b) as a result of the particular reduction and, if applicable, one or more previous reductions for a non-timber production purpose, the allowable annual cut of the licence is reduced, during the deletion period, by an amount that exceeds 5% of the original allowable annual cut.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of a forest licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of timber that would be harvested if, during each year of the remaining term of the licence,

(a) the volume of timber harvested were equal to that portion of the total compensable AAC that is attributable to the particular reduction referred to in subsection (1) (a),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Compensation for forest licence for reduction for other special purposes

240   (1) The holder of a forest licence is entitled to compensation if the allowable annual cut of the forest licence is reduced as a result of a particular reduction for other special purposes.

(2) Subject to the adjustments under subsection (3), the compensation to which the holder of a forest licence is entitled under this section is an amount determined by the minister based on the net income that would be earned on the sale of timber that would be harvested if, during each year of the remaining term of the forest licence,

(a) the volume of timber harvested were equal to the amount by which the allowable annual cut of the licence is reduced as a result of the particular reduction referred to in subsection (1),

(b) the timber were harvested from the relevant harvest profile, and

(c) the timber were harvested and sold in accordance with established practices.

(3) After determining the net income amount under subsection (2), the minister must

(a) adjust the compensation, in accordance with the regulations, to reflect the amount of income tax that would be payable, and

(b) make other adjustments that may be required by regulation.

Division 4 — Compensation for Cutting Permits

Compensation if special purpose area overlaps cutting permit area

241   (1) The minister may compensate the holder of a cutting permit issued under a tree farm licence, first nations woodland licence, non-TFL timber licence, forest licence or forestry licence to cut if a special purpose area overlaps the cutting permit area and one of the following occurs:

(a) in the case of a cutting permit issued under a tree farm licence, first nations woodland licence or non-TFL timber licence, the area of overlap is deleted under section 194 (1) [deletion of cutting permit area within licence area];

(b) in the case of a cutting permit issued under a forest licence, rights to harvest in the area of overlap are cancelled by an order under section 206 (1) (c) [order to amend, suspend or cancel rights under cutting permit under forest licence];

(c) in the case of a cutting permit issued under a forestry licence to cut, rights to harvest in the area of overlap are cancelled by an order under section 208 (2) (c) [order to amend, suspend or cancel rights under certain other licences or permits].

(2) The compensation for which the holder of a cutting permit is eligible under subsection (1) is the amount determined by the minister in accordance with the regulations.

Compensation if special purpose area does not overlap cutting permit area

242   (1) The minister may compensate the holder of a cutting permit issued under a tree farm licence, first nations woodland licence, non-TFL timber licence, forest licence or forestry licence to cut if an area designated as a special purpose area does not overlap the cutting permit area but the minister is satisfied that the following requirements are met:

(a) the cutting permit was issued before the effective date of the designation;

(b) as a result of the special purpose area, there is no practicable means by which the holder can access the cutting permit area or a portion of the cutting permit area.

(2) If the holder of a cutting permit believes that the requirements under subsection (1) are met, the holder must provide to the minister, in the form and manner that the minister may require,

(a) a statement setting out why the holder considers that the requirements are met, and

(b) any additional information that the minister may require.

(3) The holder of a cutting permit is not eligible for compensation under subsection (1) unless all the information required under subsection (2) is provided before the earlier of

(a) the date the designation referred to in subsection (1) is cancelled, and

(b) the date the cutting permit expires.

(4) If the requirements under this section are met, the compensation for which the holder of the cutting permit is eligible is the amount determined by the minister in accordance with the regulations.

Compensation for cutting permit under community forest agreement or woodlot licence

243   (1) The minister may compensate the holder of a cutting permit issued under a community forest agreement or woodlot licence if the minister is satisfied that the impact and other requirements specified in the regulations are met.

(2) If the requirements under subsection (1) are met, the compensation for which the holder of the cutting permit is eligible is the amount determined by the minister in accordance with the regulations.

Duty of cutting permit holder to provide information to minister

244   (1) The holder of a cutting permit must provide to the minister, on request, information the minister considers necessary for the purposes of considering or determining a matter under this Division.

(2) Information requested by the minister under this section must be provided in the form and manner and within the time period specified by the minister.

Division 5 — Compensation for Other Agreements

No compensation for fibre supply licence to cut or free use permit

245   No compensation is payable to the holder of a fibre supply licence to cut or free use permit in respect of an order under section 208 (2) [order to amend, suspend or cancel rights under certain other licences or permits] that amends, suspends or cancels rights under the licence or permit.

Compensation for forestry licence to cut

246   (1) The minister may compensate the holder of a forestry licence to cut if

(a) rights under the licence are cancelled by an order under section 208 (2) (c) [order to amend, suspend or cancel rights under certain other licences or permits], and

(b) the minister is satisfied that the requirements specified in the regulations are met.

(2) If the requirements under subsection (1) are met, the compensation for which the holder of the forestry licence to cut is eligible is the amount determined by the minister in accordance with the regulations.

Compensation for timber sale licence

247   (1) No compensation is payable to the holder of a timber sale licence in respect of an order under section 208 (2) (a) or (b) [order to amend, suspend or cancel rights under certain other licences or permits] that amends or suspends rights under the licence.

(2) The minister may compensate the holder of a timber sale licence if

(a) rights under the licence are cancelled by an order under section 208 (2) (c), and

(b) the minister is satisfied that the requirements specified in the regulations are met.

(3) If the requirements under subsection (2) are met, the compensation for which the holder of the timber sale licence is eligible is the amount determined by the minister in accordance with the regulations.

No compensation, unless regulations provide otherwise, for pulpwood agreement

248   (1) Unless the regulations provide otherwise, no compensation is payable to the holder of a pulpwood agreement in respect of an order under section 208 (2) [order to amend, suspend or cancel rights under certain other licences or permits] that amends, suspends or cancels rights under the pulpwood agreement.

(2) Subsection (1) does not affect the compensation for which the holder of a pulpwood agreement may be eligible, under Division 4 [Compensation for Cutting Permits], in respect of a cutting permit that is issued under a forestry licence to cut that is issued under the pulpwood agreement.

Compensation for Christmas tree permit

249   (1) The minister may compensate the holder of a Christmas tree permit if

(a) rights under the permit are cancelled by an order under section 208 (2) (c) [order to amend, suspend or cancel rights under certain other licences or permits], and

(b) the minister is satisfied that the requirements specified in the regulations are met.

(2) If the requirements under subsection (1) are met, the compensation for which the holder of the Christmas tree permit is eligible is the amount determined by the minister in accordance with the regulations.

Division 6 — Compensation for Roads and Timber Production Improvements

Interpretation rule for ancillary road structures

250   For certainty, if an ancillary road structure is used in relation to a road, the ancillary road structure forms part of the road.

Application of Division 6 of Part 16 to road authorized under special use permit or master licence to cut

251   (1) This Division applies in relation to a road authorized under a special use permit only if the road provides access to an area for a timber production purpose.

(2) This Division does not apply in relation to a road authorized under

(a) a master licence to cut, or

(b) a cutting permit issued under a master licence to cut.

Compensation for road located in special purpose area

252   (1) The minister may compensate the holder of a road permit or special use permit that authorizes a road located in an area designated as a special purpose area if the minister is satisfied that the following requirements are met:

(a) the road permit or special use permit was issued before the effective date of the designation;

(b) in the case of a road permit, the road permit is associated with a forest licence, timber licence, tree farm licence or prescribed licence;

(c) rights in relation to the road are cancelled by an order under section 213 (1) (c) [order to amend, suspend or cancel rights in relation to road];

(d) the general requirements under section 253;

(e) the requirements, if any, specified in the regulations.

(2) If the requirements under subsection (1) are met, the minister may compensate the holder of the road permit or special use permit for the costs or a portion of the costs incurred to construct the road, as determined by the minister in accordance with the regulations.

General requirements for compensation for road

253   The general requirements for compensation in relation to a road authorized under a road permit or special use permit are as follows:

(a) the holder of the permit has incurred costs to construct the road;

(b) the costs referred to in paragraph (a) have not been paid, and are not payable, by the government;

(c) the holder of the permit has not, under this Act or another enactment, previously received compensation in respect of the road;

(d) payment of compensation is just in the circumstances.

Compensation for road located outside special purpose area if road associated with cutting permit

254   (1) The minister may compensate the holder of a road permit that authorizes a road located outside an area designated as a special purpose area if the minister is satisfied that the following requirements are met:

(a) the road is associated with a cutting permit;

(b) the cutting permit was issued, before the effective date of the designation, under a forest licence, timber licence, tree farm licence or prescribed licence;

(c) costs to construct the road were applied under section 105 [stumpage rate determined], before the effective date of the designation, to determine, redetermine or vary the rate of stumpage for timber authorized to be harvested under the cutting permit;

(d) harvesting rights under the cutting permit are impacted, as a result of the special purpose area, in one of the ways described in section 255;

(e) the general requirements under section 253;

(f) the requirements, if any, specified in the regulations.

(2) If the requirements under subsection (1) are met, the minister may compensate the holder of the road permit for the costs or a portion of the costs incurred to construct the road, as determined by the minister in accordance with the regulations.

Impact requirements for road associated with cutting permit

255   (1) For the purposes of section 254 (1) (d), harvesting rights under the cutting permit are impacted, in the case of a special purpose area that overlaps the cutting permit area, if both of the following apply:

(a) harvesting under the cutting permit cannot be completed in the area of overlap because

(i) the area of overlap is deleted from the cutting permit area under section 194 (1) [deletion of cutting permit area within licence area], or

(ii) rights exercisable in the area of overlap are cancelled by an order under

(A) section 206 (1) (c) [order to amend, suspend or cancel rights under cutting permit under forest licence], or

(B) section 208 (2) (c) [order to amend, suspend or cancel rights under certain other licences or permits];

(b) harvesting under the cutting permit cannot reasonably be completed by harvesting timber from areas located outside the area of overlap.

(2) For the purposes of section 254 (1) (d), harvesting rights under the cutting permit are impacted, in the case of a special purpose area that does not overlap the cutting permit area, if harvesting under the cutting permit is no longer practicable in the cutting permit area or a portion of the cutting permit area.

Compensation in other cases if road under road permit located outside special purpose area

256   (1) The minister may compensate the holder of a road permit that authorizes a road located outside an area designated as a special purpose area if the minister is satisfied that the impact and other requirements specified in the regulations are met.

(2) If the requirements under subsection (1) are met, the minister may compensate the holder of the road permit for the costs or a portion of the costs incurred to construct the road, as determined by the minister in accordance with the regulations.

Compensation if road under special use permit located outside special purpose area

257   (1) The minister may compensate the holder of a special use permit that authorizes a road located outside an area designated as a special purpose area if the minister is satisfied that the impact and other requirements specified in the regulations are met.

(2) If the requirements under subsection (1) are met, the minister may compensate the holder of the special use permit for the costs or a portion of the costs incurred to construct the road, as determined by the minister in accordance with the regulations.

Compensation for timber production improvement located in special purpose area

258   (1) The minister may compensate the holder of a special use permit that authorizes a timber production improvement located in a special purpose area if the minister is satisfied that the following requirements are met:

(a) rights in relation to the timber production improvement are cancelled by an order under section 219 [order to amend, suspend or cancel rights in relation to timber production improvement];

(b) the costs incurred to construct the timber production improvement have not been paid, and are not payable, by the government;

(c) the holder has not, under this Act or another enactment, previously received compensation in respect of the timber production improvement;

(d) payment of compensation is just in the circumstances.

(2) If the requirements under subsection (1) are met, the minister may compensate the holder of the special use permit for the costs or a portion of the costs incurred to construct the timber production improvement, as determined by the minister in accordance with the regulations.

Compensation for timber production improvement located outside special purpose area

259   (1) The minister may compensate the holder of a special use permit that authorizes a timber production improvement located outside a special purpose area if the minister is satisfied that the following requirements are met:

(a) as a result of the special purpose area,

(i) the means by which the holder accesses the improvement can no longer be used, and

(ii) there is no practicable alternative means by which the holder can access the improvement;

(b) the requirements under section 258 (1) (b), (c) and (d).

(2) If the requirements under subsection (1) of this section are met, the minister may compensate the holder of the special use permit for the costs or a portion of the costs incurred to construct the timber production improvement, as determined by the minister in accordance with the regulations.

Duty of holder of licence to provide information to minister

260   (1) The holder of a road permit or special use permit must provide to the minister, on request, information the minister considers necessary for the purposes of considering or determining a matter under this Division.

(2) Without limiting subsection (1), the minister may request the holder of a road permit or special use permit to provide information that identifies or provides evidence of any of the following:

(a) areas where harvesting has occurred or has not yet occurred in a cutting permit area or other area in which the holder has harvesting rights;

(b) areas or the size of areas that contain timber within an area referred to in paragraph (a);

(c) the volume of timber that has been harvested in an area referred to in paragraph (a);

(d) costs that have actually been incurred to construct a road, ancillary road structure or timber production improvement.

(3) Information requested under this section must be provided in the form and manner and within the time period specified by the minister.

Order to cancel rights in relation to road for which compensation provided

261   The minister may, by order, cancel rights under a road permit or special use permit if

(a) the rights relate to a road or timber production improvement that is located outside a special purpose area, and

(b) the minister decides to provide compensation under this Division to the holder of the permit.

Division 7 — General Provisions in Relation to Compensation

Compensation may take form of agreement

262   (1) On application to the minister by the holder of an area-based licence, non-TFL timber licence or forest licence, the compensation or a portion of the compensation to which the holder is entitled under this Part may take the form of an agreement listed in section 12 (1) [form of agreements].

(2) For the purposes of subsection (1), the minister may enter into an agreement with the holder of the licence without advertising or inviting applications from other persons.

Reductions and exceptions in respect of compensation

263   (1) The compensation that the minister provides to a person under this Part must be reduced by any financial or other benefit that

(a) the person receives from the government, and

(b) arises out of the deletion, reduction, order or other impact that gives rise to the compensation.

(2) If a person waives entitlement, in whole or in part, to compensation under this Part, the minister, as applicable,

(a) is not required to provide the compensation, or

(b) may reduce the amount of the compensation.

Limit on compensation in relation to special purpose areas

264   (1) In this section, "compensation" includes damages.

(2) Unless this Part provides otherwise,

(a) no compensation is payable by the government because of or arising out of the designation of an area as a special purpose area, and

(b) no action or other proceeding may be commenced or maintained to claim compensation from the government, or to obtain a declaration that compensation is payable by the government, because of or arising out of the designation of an area as a special purpose area.

(3) In respect of a matter for which compensation is payable to a person under this Part,

(a) the compensation payable to the person in respect of the matter is limited to the amount of compensation determined in relation to that person under this Part, and

(b) no action or other proceeding may be commenced or maintained to claim compensation from the government, or to obtain a declaration that compensation is payable by the government, in an amount that exceeds the amount limited under paragraph (a).

Division 8 — Regulations Under Part 16

General regulation-making powers for Part 16

265   (1) The Lieutenant Governor in Council may make regulations respecting compensation for the purposes of this Part, including for the purposes of any provision of this Part that provides for compensation or contemplates regulations that will provide for compensation.

(2) In making a regulation for the purposes of this Part, the Lieutenant Governor in Council may do any of the following:

(a) authorize or require the chief forester or minister to specify or determine matters relating to the provision or determination of compensation;

(b) specify information or matters that the chief forester or minister may or must consider;

(c) specify matters for which or circumstances under which compensation may or may not be paid;

(d) specify records that may be used, in relation to the harvest and sale of timber,

(i) as evidence of established practices, or

(ii) to develop data for use as evidence of established practices;

(e) specify requirements, criteria, rules, principles, concepts, methods, models or formulas in relation to the provision or determination of compensation;

(f) provide that compensation is to be calculated based on present value;

(g) establish adjustments that may or must be made to compensation, including, without limitation, adjustments to reflect income tax that would be payable in relation to net income;

(h) specify how adjustments specified under paragraph (g) are to be made, calculated or determined;

(i) specify whether or not interest is authorized or required to be paid;

(j) if interest is authorized or required to be paid, prescribe interest rates and the manner of calculating interest;

(k) prescribe the role of auditors or other experts and the qualifications for auditors or other experts;

(l) without limiting section 151 (1.1), provide that a provision of the regulations does not apply in relation to

(i) a specified agreement, licence, permit or other authorization referred to in this Part, or

(ii) a specified class of agreement, licence, permit or other authorization referred to in this Part.

(3) The authority to make regulations described in another provision of this Part does not limit subsection (1) or (2).

(4) A regulation made on or before December 31, 2026 for the purposes of this Part may be made retroactive to a date not earlier than July 15, 2023 and, if made retroactive, is deemed to have come into force on the specified date.

Regulations respecting determination of net income

266   In making a regulation for the purposes of this Part, the Lieutenant Governor in Council may do any of the following in relation to the determination of net income:

(a) provide for the determination of revenues and costs referred to in the formula set out in section 228 [meaning of "net income"];

(b) require that revenues be determined based on any of the following:

(i) arm's-length transactions;

(ii) average revenues over a specified period;

(c) require that costs be determined based on average costs incurred;

(d) specify additional costs or expenses that must be deducted from revenues;

(e) specify costs that are excluded from the determination of costs.

Regulations respecting provision of information

267   In making a regulation under this Part, the Lieutenant Governor in Council may do any of the following:

(a) require the holder of an agreement, licence, permit or other authorization referred to in this Part to provide

(i) information specified in the regulation, or

(ii) information specified by the chief forester or minister;

(b) restrict or impose conditions on the use of information referred to in paragraph (a);

(c) specify the form and manner in which information referred to in paragraph (a) must be provided, or require the holder to provide the information in the form and manner that the chief forester or minister may require.

Regulations respecting compensation for cutting permits

268   (1) In making a regulation respecting compensation contemplated by a provision of Division 4 [Compensation for Cutting Permits], the Lieutenant Governor in Council may do any of the following:

(a) specify impact and other requirements that must be met for the purposes of section 243 (1) [compensation for cutting permit under community forest agreement or woodlot licence];

(b) require or authorize the minister to determine compensation based on any or all of the following:

(i) the harvest profile for a cutting permit area;

(ii) established practices in relation to the harvest and sale of timber;

(iii) the average volume of harvestable timber, per hectare, in a cutting permit area;

(iv) the number of hectares in an affected cutting permit area that contain harvestable timber;

(v) the average net income, per cubic metre, that would be earned from the sale of harvestable timber that is harvested in a cutting permit area;

(c) set out rules that apply if the holder of a cutting permit, as a result of the designation of an area as a special purpose area, is or would be entitled to or eligible for compensation under both

(i) a provision of Division 4 [Compensation for Cutting Permits], and

(ii) a provision of Division 2 [Compensation for Area-Based Licences and Non-TFL Timber Licences] or 3 [Compensation for Forest Licences].

(2) A regulation under subsection (1) (c) may specify circumstances in which, despite Division 2 or 3,

(a) a holder who is entitled to or eligible for compensation under Division 4 is not entitled to compensation under Division 2 or 3, or

(b) the amount of compensation under Division 2 or 3 must be reduced, in accordance with the regulations, to reflect compensation to be provided under Division 4.

(3) A regulation made for the purposes of section 243 [compensation for cutting permit under community forest agreement or woodlot licence] may authorize the minister to provide compensation, in the amount determined by the minister, to the holder of a specified cutting permit issued under a community forest agreement.

Regulations respecting compensation for roads and timber production improvements

269   In making a regulation respecting compensation contemplated by a provision of Division 6 [Compensation for Roads and Timber Production Improvements], the Lieutenant Governor in Council may do any of the following:

(a) specify requirements that must be met for the purposes of the following provisions:

(i) section 252 (1) (e) [compensation for road located in special purpose area];

(ii) section 254 (1) (f) [compensation for road located outside special purpose area if road associated with cutting permit];

(b) specify impact and other requirements that must be met for the purposes of the following provisions:

(i) section 256 (1) [compensation in other cases if road under road permit located outside special purpose area];

(ii) section 257 (1) [compensation if road under special use permit located outside special purpose area];

(c) require that compensation be determined based on costs actually and reasonably incurred;

(d) require that compensation for costs incurred to construct a road be based on road costs applied under section 105 [stumpage rate determined];

(e) require that compensation in respect of a road be reduced if costs incurred to construct the road include any costs associated with an ancillary road structure that is

(i) used in relation to the road, and

(ii) removed by the person to whom the compensation relates;

(f) require that compensation in respect of a road be proportionate to the amount of harvestable timber that the minister determines can no longer be harvested as a result of the special purpose area to which the compensation relates;

(g) require that compensation be reduced to account for amortization or depreciation;

(h) require that compensation be adjusted to take into account an amortization agreement entered into with the government before the effective date of the designation to which the compensation relates.

Contents | Part 1 | Part 2 | Part 3 | Part 4 | Part 5 | Part 6 | Part 6.1 | Part 7 | Part 8 | Part 9 | Part 10 | Part 11 | Part 11.1 | Part 12 | Part 13 | Part 14 | Part 15 | Part 16 | Part 17 | Part 18 | Part 19