Canada’s Raitt Seeks New Vehicle-Recall Powers to Match U.S.

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Canada’s Transport Minister Lisa Raitt is introducing a law that would allow her to force companies to order vehicle recalls and impose fines.

The proposed law would also give Raitt the authority to compel carmakers to fix recalled vehicles, pay for repairs and ensure new vehicles are fixed in the event of a recall before being sold.

“The decision on whether or not a recall should happen should not be left to industry,” the minister told reporters in Ottawa on Monday. “We fundamentally believe that there should be a role for government in this case.”

If passed, the law would allow Raitt to impose cash penalties on companies in certain cases and would not set a cap on those penalties. “We think that’s an important enforcement tool,” the minister said.

Text of the legislation, which would amend the Motor Safety Vehicle Safety Act as promised in the Conservative government’s April budget, will be publicly released in the coming days, Raitt said. It would need to be rushed through the House of Commons and Senate to become law before both chambers rise this month ahead of Canada’s fall election.

The bill is aimed at “addressing some problems that we have found in the past years in dealing with” recalls involving General Motors Co. and Takata Corp., an airbag manufacturer, Raitt said. A series of carmakers in Canada have issued recalls related to Takata airbags, many of them in the past month.

‘Same Capabilities’

The move would further align Canada’s vehicle recall laws with those in the U.S., where regulators have “a wide range of measures at their disposal” to handle recalls, Raitt said.

Arguing Canada should have “the same capabilities,” the minister said she believed the proposed law would receive unanimous support and be able to pass quickly.

Hoang Mai, a transport critic with the opposition New Democratic Party, said he would wait to read the bill before deciding on whether to support it. “We think it’s a step in the right direction,” he said.

Mark Nantais, president of the Canadian Vehicle Manufacturers’ Association, also wanted to read the proposed law before taking a firm position. But he said in an interview that his group works closely with Transport Canada and -- in theory - - supports any effort to align U.S. and Canadian regulations “so we don’t have systems that create an undue burden.”

Recent Cases

The Takata and GM recalls were “probably two anomalies” in the history of vehicle recalls, Nantais said. “Most recalls are actually done without government intervention. They’re done voluntarily.”

After the budget was released, GM referred questions to the CVMA. The carmaker did so again after Raitt’s announcement on Monday.

The recall rules were not among the changes included in the omnibus budget bill formally released by Prime Minister Stephen Harper’s government last month, which is expected to become law before the next election.

The government has warned that other bills currently advancing in the House of Commons and Senate may not be passed in time to become law by the election, scheduled for October 19. Both the Senate and House of Commons are to adjourn later this month and any proposed law not passed by then would die.

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