1st Session, 36th Parliament,
46-47-48 Elizabeth II, 1997-98-99

The House of Commons of Canada

BILL C-493

An Act to promote shipbuilding, 1999

      Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

SHORT TITLE

Short title

1. This Act may be cited as the Shipbuilding Act, 1999.

DEFINITIONS

Definitions

2. The definitions in this section apply in this Act.

``Canadian ship''
« navire canadien »

``Canadian ship'' means a ship that is owned by one or more persons each of whom is a Canadian citizen, a person resident and domiciled in Canada or a corporation incorporated under the laws of Canada or a province, having its principal place of business in Canada.

``commer-
cial ship''
« navire commer-
cial »

``commercial ship'' includes a passenger ship, bulker, self unloader, cargo, tanker, tug, towboat, barge, dredge, icebreaker, oceanographic research ship, pollution abatement ship, offshore oil and gas drilling rig, floating drydock, fishing vessel and any other commercial ship prescribed by regulation.

``conver-
sion of a ship''
« conversion d'un navire »

``conversion of a ship'' means the conversion of a non-commercial ship into a commercial ship or the conversion of one type of commercial ship into another type of commercial ship.

``fishing vessel''
« bateau de pêche »

``fishing vessel'' includes any ship or boat or any other description of vessel used in or equipped for

    (a) fishing or processing or transporting fish from fishing grounds; or

    (b) taking, processing or transporting marine plants.

``foreign ship''
« navire étranger »

``foreign ship'' means a ship that is not a Canadian ship.

``non-
commercial
ship''
« navire non commer-
cial »

``non-commercial ship'' means a ship that is not a commercial ship.

PURPOSE

Purpose

3. (1) The purpose of this Act is to promote shipbuilding in Canada and make Canadian shipyards more competitive

    (a) through the establishment of a program whereby a maximum of 87.5% of the money borrowed by a company from financial institutions to purchase a commercial ship that will be built in a shipyard located in Canada

      (i) is guaranteed by the federal government in the event of default in the repayment of the loan,

      (ii) bears a rate of interest comparable to that available for loans from financial institutions to large and financially strong corporations, and

      (iii) is repayable on terms comparable to those usually granted by financial institutions to large and financially strong corporations for the repayment of their loans;

    (b) by amending the provisions of the Income Tax Act and the Income Tax Regulations to improve the tax treatment of lease financing for the purchase of a ship built in a Canadian shipyard; and

    (c) subject to subsection (2), by amending the provisions of the Income Tax Act and the Income Tax Regulations to allow a refundable tax credit for a portion of the costs relating to the construction or refit of a commercial ship in a shipyard located in Canada or the conversion of a ship in such a shipyard

      (i) to the shipowner for the construction of a Canadian ship, or

      (ii) to the shipyard owner for the construction of a foreign ship.

Exception

(2) The tax credit referred to in paragraph (1)(c) shall not be granted to the owner of a fishing vessel who has received financial assistance under a federal or a provincial program for the development of marine fisheries.

REGULATIONS

Regulations

4. The Governor in Council may make regulations adding other kinds of ships to the definition of ``commercial ship'' in section 2.

Regulations

5. (1) Not later than three months after the coming into force of this Act and subject to affirmative resolution of Parliament, the Governor in Council shall make the regulations required to amend any Act of Parliament or Regulation in order to implement the purpose of this Act.

Coming into force of the regulations

(2) The regulations made under subsection (1) shall come into force four months after the coming into force of this Act.

Amendment or repeal of regulations

(3) The Governor in Council shall not make regulations amending or repealing a regulation made under subsection (1) that amends an Act of Parliament.