On March 24, 2012 the Minister of Health published proposed administrative monetary penalty ("AMP") regulations in the Canada Gazette, Part I. The AMP system is an enforcement tool that assigns monetary penalties to violations of orders issued pursuant to the Canada Consumer Product Safety Act ("CCPSA"). There is a 75 day comment period and comments must be submitted by June 7, 2012.
The CCPSA came into force in June, 2011. It protects the public from the dangers of unsafe consumer products through four major prohibitions. It prohibits the manufacture, importation, advertisement, and sale of consumer products that: first, are classified as dangerous; second, do not satisfy regulatory requirements; and third, are not classified as dangerous a priori but that market experience suggests pose a danger to human health and safety. Finally, it prohibits false and misleading claims in consumer product advertisements.
To enforce these prohibitions, the Minister has the power to issue orders requiring compliance. If orders are contravened, then the Minister may engage the AMP system.
The Minister communicates contraventions of orders by delivering Notices of Violation. Notices issue with respect to non-compliance with orders either recalling a consumer product or requiring a person who manufactures, imports, advertises, or sells consumer products to "take measures" (i.e. either to cease such activities or to take any measure considered necessary to remedy any non-compliance) with respect to a consumer product. Such orders are subject to Ministerial review on request; however, the AMP system also applies to orders under Ministerial review.
The AMP system establishes penalties that range from $10,000 to $25,000 for commercial organizations and from $1,000 to $5,000 for non-profit/non-commercial organizations.
The proposed AMP regulations indicate that determining the amount of a penalty is a two-step process. First, the Minister determines a violation's gravity based on a combination of the type of violation and the person's past AMP history. Then, the Minister classifies a violation as minor, serious, or very serious based on the sum of the gravity scores. This classification sets the penalty amount.
AMP's must be paid in full within 30 days. The penalty is reduced by half if paid within 15 days. Instead of paying any penalty, however, persons subject to AMP's of over $5,000 may enter into compliance agreements with the Minister, if so agreeable, to ensure adherence with the requirements allegedly infringed. Another option, open to all persons regardless of penalty amount, is to seek Ministerial review of the circumstances of either the alleged non-compliance or the amount of the AMP.
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