Timber permits and licences under the Indian Timber Regulations
This policy outlines the requirements to cut timber on reserve lands.
Table of contents
1.0 Introduction
1.1 Timber resources on reserve are managed through permits and licences issued or granted under the authority of the Indian Act and Indian Timber Regulations. The instruments secure benefits for First Nations in the form of stumpage revenues, economic benefits, environmental protection and forest regeneration.
1.2 Timber resources are collective assets on Band lands and allotted lands. This policy addresses timber on Band lands; for information about timber on locatee lands please see the policy on individual land holdings.
1.3 This policy is intended to be an introduction to the Indian Timber Regulations, containing further clarifications and complementing those regulations with additional information.
Precedents (templates)
1.4 Precedents (also known as templates) provide the basis for permits issued and leases granted under the Indian Act, and include necessary policy and legal requirements to ensure consistency and accuracy when negotiating terms. The precedents simplify drafting, allow for a streamlined process and can be tailored to meet the needs of specific projects. Precedents are available by contacting the department terres-lands@sac-isc.gc.ca.
A national timber permit precedent is under development; however, regional offices may develop region-specific precedents to suit local contexts.
2.0 Creating a permit or licence
2.1 According to the Indian Timber Regulations, timber permits and licences allow for the removal of timber for individual use, band use or sale. Additionally, tripartite agreements may also be used to allow for the removal of on-reserve timber.
2.2 The type of permit or licence that may be issued will depend on the purpose of the instrument (personal use or sale) and to whom the instrument will be issued (for example, a Band, a group of Band members or third parties).
Permits
2.3 Permits may be issued to Bands, individual Band members or groups of Band members.
2.4 Permits may be issued for:
- Band purposes and individual use without requiring the permittee to pay compensation for the wood (section 4 of the Indian Timber Regulations), or
- the cutting of timber for sale with the requirement that the permittee pay for the wood (sections 5 to 8 of the Indian Timber Regulations)
Tripartite agreements (permits)
2.5 A tripartite agreement is a hybrid arrangement through which a section 5 permit is issued to the Band for the cutting of timber for sale, and which creates a contractual agreement between the Band, the harvester, and the department. The specific contractual arrangements will vary with the circumstances.
2.6 Under a tripartite agreement, a Band may transfer its rights to cut timber on reserve for sale to a third party harvester. The harvester retained by the Band is added as a party to the permit (creating a tripartite agreement) so that harvesting requirements and the payment of fees can be enforced.
2.7 A tripartite agreement must clearly indicate the Minister is not granting the right to cut timber on reserve, but that it is the Band, by contract, who is authorizing the third party harvester to cut timber, on the authority of its own section 5 permit.
Licences
2.8 Licences may be issued pursuant to sections 9 to 25 of the Indian Timber Regulations to third parties, including Band-owned corporations. Licences are issued for the purposes of cutting, removing and selling timber with the requirement for the licensee to pay for the wood.
2.9 Licences may be issued on lands with a pre-existing designation provided that the licence does not conflict with any interests granted under the designation. If there are conflicting interests, the conflict must be resolved prior to the issuance of a licence.
2.10 Licences to third parties are generally issued through a bidding process (see section 10 of the Indian Timber Regulations).
Authorized activity based on timber instrument
2.11 The following list outlines general authorized activities based on the type of timber instrument:
Permit for Band or individual use
Under the Indian Timber Regulations, section 4 permits authorize the cutting of timber for Band purposes, or for fuel wood for individual Band member use.
Section 4 permits may be issued to a Band, an individual Band member or a group of Band members.
Section 4 permits for Band use usually involve small volumes of low value timber and may be used as part of a prescribed forest fuel management plan. The cut timber cannot be sold and must remain on the reserve for Band use or be burnt.
Permit to cut for sale
Under the Indian Timber Regulations, with the consent of the Band Council, section 5 permits authorize the cutting of timber for sale. Section 5 permits may be issued to a Band, an individual Band member, or a group of Band members.
Alternatively, a tripartite agreement may be issued as a hybrid arrangement. This is a permit issued to the Band and is a contractual agreement between 3 parties: the department, the Band, and the purchaser.
Licence
Under the Indian Timber Regulations, section 9 licences are issued with the consent of the Band Council through a tender process, as outlined in section 10 of the Indian Timber Regulations. Section 9 licences may be issued to any successful third party.
Permit for disposal of wild grass or dead or fallen timber
Under the Indian Act, a section 58(4)(a) permit allows for the disposal of wild grass or dead or fallen timber. This section only applies to timber that has fallen as a result of natural causes and does not authorize harvesting of standing timber.
2.12 All terms and conditions of timber permits and licenses, other than those specified in the Indian Timber Regulations, must comply with the general policy for permitting on reserve land.
3.0 Specific requirements for timber permits and licences
3.1 In addition to the requirement to comply with the Indian Act, the Indian Timber Regulations and other applicable federal legislation, timber permits and licences will contain terms, conditions and restrictions such as, but not limited to, the following:
Access to the permit or licence area
3.2 Access (for example, by road) and construction of new logging roads, if required, must be addressed in the permit or licence.
3.3 The permit or licence must require the proponent to agree to not obstruct or damage roads, trails or property within the permit or licence area or on adjacent lands.
Security deposits
3.4 Security deposits must be:
- provided by the permittee or licensee to ensure there is money for site reclamation and remediation
- made payable to the Receiver General for Canada
- in the form of money, bonds or promissory notes (for example, letters of credit, safekeeping agreements) and must be verified for validity under section 14 of the Indian Timber Regulations
- comprised of 15% of the estimated dues
3.5 The security deposit must be held by the department in safe custody and will be handled in accordance with the Financial Administration Act and its Government Contract Regulations. Upon termination of the permit or licence, the security or reclamation deposits are refunded, without interest, provided the permittee or licensee has complied with the terms and conditions of the permit or licence. In the event of non-compliance with the terms and conditions of the permit or licence, the security or reclamation deposits are used to pay for required work.
Insurance
3.6 The permittee or licensee must provide proof of liability insurance before a permit is authorized or a licence is granted. His Majesty the King in Right of Canada must be included on the policy as an additional insured. The requirement for insurance can be waived in certain circumstances, such as when municipal and provincial departments and other Crown entities are the permittee or the licensee.
Environmental considerations
3.7 Before the initiation of any timber activity, an environmental review in accordance with the department's environmental review process and the Impact Assessment Act must be carried out.
For more information on environmental considerations, please see the Environmental Management Processes on Reserve chapter.
Logging plan
3.8 The intent of a logging plan is to provide site specific details, harvesting methods and technology to be used to ensure harvesting operations achieve the standards and obligations set out in the timber permits or licences, and ensure compliance with higher level plans, such as forest management plans (if such plans are in place).
3.9 A logging plan must be completed by the proponent. The logging plan should include a description of the area being logged, the methods and equipment being used, the season of the logging, overview and logging plan maps, silviculture prescriptions, timber cruise reports, appraisal calculations, heritage studies and other related information. It should also identify any potential logging problems and environmental concerns.
3.10 The logging plan must be consistent with and reflect the proposed mitigation measures identified during the departmental environmental review process, Species at Risk Act reports and permits, and other relevant by-laws and legislation.
Stumpage fees
3.11 The departmental regional office determines the prevailing stumpage rates, including export levies, if applicable. Stumpage fees are usually based on provincial average rates for the given forest district in which the timber is located.
Fire prevention and suppression
3.12 The permittee or licensee must assume all costs for fire protection services and fire suppression of any fire in the permit or licence area.
Compliance with other laws and regulations
3.13 Compliance with other federal laws and regulations, provincial laws and controls, municipal by-laws and Band by-laws relevant to timber harvesting is required.
Provincial controls and timber mark
3.14 Permits or licences for sale must address transportation of timber off-reserve. Provinces regulate and establish controls over the transportation of timber. Haulers of timber are required to complete appropriate provincial forms outlining the source and destination of the timber, and keep records on a monthly basis on field scale sheets, truck and load records and other information according to provincial regulations. British Columbia, New Brunswick, Quebec and Ontario have timber marking systems which require that timber transported on public roads be marked to identify ownership.
4.0 Registering a permit or licence
4.1 Permits or licences and any associated documentation, including forms and agreements, must be prepared in a form suitable for registration in the Indian Lands Registry System and must, in accordance with section 55 of the Indian Act, be sent for registration in accordance with the requirements of the Indian Lands Registration Manual.
5.0 Unauthorized removal of timber
5.1 Both the Indian Act and the Indian Timber Regulations include provisions related to timber offenses and the unauthorized removal of timber.
5.2 Under section 93 of the Indian Act, it is an offence for anyone to remove, or allow the removal of, timber, trees, saplings, shrubs, underbrush, or cordwood from a reserve without permission, or for anyone to be in possession of any timber so removed.
5.3 Section 103 of the Indian Act addresses, among other things, situations where timber may be seized if there are reasonable grounds to believe an offence has been committed under section 93.
5.4 Under section 3.1 of the Indian Timber Regulations, it is an offense to cut timber on reserve lands without a licence issued by the Minister.
5.5 Under section 26 of the Indian Timber Regulations, the Minister may seize timber where there are reasonable grounds to believe certain offences have been committed.