Alberta Court Says Impact Assessment Act Still Unconstitutional

The Impact Assessment Act just took another hit in court. Alberta's Court of Appeal ruled on Friday that Ottawa's federal project-review law is still unconstitutional, even after the government rewrote parts of it, according to The Canadian Press.

The 4-1 decision lands at an awkward moment. Ottawa and Alberta are teaming up on a new oil pipeline to the West Coast, and Prime Minister Mark Carney's government is pushing a big build-things agenda. A court telling Ottawa its main review law oversteps provincial turf is a plot twist nobody at the cabinet table wanted.

What the court actually said

The Impact Assessment Act, also known as C-69, sets out how Ottawa reviews the environmental, economic, health and social effects of big projects like ports, mines and pipelines. The Supreme Court of Canada struck down much of the original version in 2023. Ottawa then amended it, and Alberta went back to court for round two.

The appeal court said the new version still goes too far. Among other things, the law still lets Ottawa stop a project in provincial jurisdiction if it has even the smallest impact on federal jurisdiction, according to the Canadian Press report carried by the Winnipeg Free Press. Some of the changes Ottawa made were fine, the judges said, but the overall powers stayed too broad.

In the court's words: "This merely exacerbates the concern that a federal assessment scheme might enable the federal government, on the pretext of some narrow ground of federal jurisdiction, to conduct a far-ranging inquiry into matters that are exclusively within provincial jurisdiction." Ontario and Saskatchewan both backed Alberta's challenge.

The legal hook problem, explained simply

Think of it like this: Ottawa can look at federal effects of a provincial project, such as impacts on fisheries or federal lands. What it can't do, the court said, is use those effects as a hook to regulate the whole project. The Canadian Constitution Foundation, which intervened in the case, says the majority agreed with that core argument.

According to the Canadian Constitution Foundation, the court found that the designated projects part of the law and its regulations are unconstitutional, except insofar as they apply to federal undertakings. It also found the new "non-negligible" threshold doesn't meaningfully limit which projects get caught, and that the public-interest decision-making step still lets non-federal concerns drive federal decisions.

Why Alberta is celebrating

The law has been a lightning rod for years. Oil and gas players hate it, and Conservative Leader Pierre Poilievre has long called for it to be repealed. Former Alberta premier Jason Kenney nicknamed it the "no more pipelines act."

Premier Danielle Smith called the ruling "yet another big win for Alberta" and urged Ottawa to skip another appeal and work with the provinces to fix what she called flawed Trudeau-era legislation. Federal Environment Minister Julie Dabrusin's office said the government is reviewing the decision and considering next steps, adding that the law is "fundamental" to its building agenda.

Why this matters for the pipeline push

The timing is spicy. Earlier this month the Pacific Link pipeline became the first project designated a national priority under the new Building Canada Act, and the Globe and Mail reports the government wants the federal review done by Sept. 1, 2027, with the line running by 2032. The Globe also reports an Alberta First Nation is already taking Ottawa to court over that designation, the first legal challenge to the fast-track.

Ottawa is also trying to shift pipeline reviews from the Impact Assessment Agency to the Canada Energy Regulator through the newly tabled Bill C-39. But the government has said the regulator will still be bound by the Impact Assessment Act when it does those reviews, the same law the Alberta court now says is unconstitutional. That's a knot lawyers will be pulling on for a while.

What happens next

Ottawa hasn't said whether it will appeal. When the Supreme Court weighed in before, it split 5-2, so a second trip there is possible. Environmental groups are already pushing back: Ecojustice says it is deeply disappointed and wants the Carney government to appeal.

For anyone under 30 watching climate policy, the takeaway is simple. Who gets to say yes or no to big energy projects is being fought out in courtrooms, and each ruling changes how fast pipelines, mines and ports can move. Expect the Impact Assessment Act to keep making headlines through the fall. More politics coverage lives at GenZ NewZ Politics and Canadian News.

Sources: CBC News, Winnipeg Free Press, Canadian Constitution Foundation and The Globe and Mail.