Balancing nation-building, speed and certainty with a constitutional imperative

A prescient Supreme Court warning worth revisiting

In Clyde River, a 2017 decision that answered the extent to which the Crown can look to rely on regulatory processes to address Indigenous peoples’ concerns regarding impacts to their rights, a unanimous Supreme Court of Canada issued a prescient warning, that “No one benefits — not project proponents, not Indigenous peoples, and not non-Indigenous members of affected communities — when projects are prematurely approved only to be subjected to litigation.”^[1]

Streamlining vs. constitutional duty

The current trend to fast-track “nation-building” major projects through regulatory streamlining, via legislative efforts such as Ontario’s Bill 5, BC’s Bill 15, and federal Bill C-5, look to empower federal and provincial cabinets to exempt projects from various regulatory requirements, aiming for efficiency and expedience.

However, these efforts risk clashing with the Crown’s constitutional duty to consult and accommodate Indigenous peoples. While the Crown’s duty (which emanates from a constitutional principle known as the honour of the Crown) can be shaped by regulatory processes, its constitutional nature means that it cannot be legislatively reduced in scope or bypassed. Attempts to do so in the context of processes that are themselves intended to help discharge the Crown’s obligations to Indigenous peoples could, paradoxically, therefore lead instead to more legal challenges and in turn undermine the stated goals of streamlining and achieving project certainty.

The rise of Indigenous equity in major projects

An important trend that forms part of the current backdrop includes loan guarantee programs intended to support Indigenous equity ownership in major projects. The federal Indigenous Loan Guarantee Program was recently doubled to $10 billion, and Ontario’s rough equivalent tripled to $3 billion. Credible research from March 2025 states that in the next decade, $630 billion of capital investment is planned in major projects in energy, mining, and forestry sectors, excluding infrastructure, transportation, and trade projects. It further suggests that at least $50 billion is needed to support Indigenous investment in major projects. 

Can streamlining and consultation coexist?

These efforts are especially relevant given the “streamlining” proposed by these bills, since they may create a renewed emphasis on prioritizing Indigenous interests and a need to place them alongside core matters considered during project planning and selection stages. If Indigenous peoples are increasingly in the position of project proponent, the theory goes, might the goal of regulatory streamlining better align?

Lessons from Haida Nation and Taku River

From a legal perspective, the Supreme Court of Canada’s 2004 unanimous decisions in Haida Nation and Taku River are the starting point when considering the extent to which regulatory reviews can be “streamlined” as concerning the rights of Indigenous peoples. These decisions establish that the Crown has a duty to consult with and accommodate Indigenous peoples when decisions are contemplated that may affect their rights.^[2]

While both decisions confirm the Crown’s ability to rely on regulatory processes to assist in discharging that duty, caveats apply. Haida Nation warned against adopting “unstructured” regulatory regimes that risk infringing Indigenous rights without guidance.^[3] To similar effect, while in Taku River the Court found that the Crown had met its duty by directly involving the Taku River Tlingit First Nation in a robust environmental assessment process, in Haida Nation the Crown was found to have failed, because no consultation had occurred at early, strategic stages.^[4]

The evolving legal landscape

Subsequent cases have confirmed and refined the intersection of the Crown’s duty with regulatory processes. Some six years later in Beckman, the Supreme Court clarified that Indigenous participation in regulatory processes designed for other purposes may even satisfy the Crown’s duty, if the process is sufficiently robust; Beckman also cemented the constitutional status of the honour of the Crown as a legal principle.^[5]

To similar effect, nearly 15 years ago the B.C. Court of Appeal described the duty as being situated “upstream” of statutory mandates,^[6] and 18 years ago the Federal Court commented that it “cannot be boxed in by legislation.”^[7]

In Rio Tinto, a 2010 decision, a unanimous Supreme Court stressed the importance of timing, stating that early “strategic, higher-level decisions” that may not impact lands and resources immediately, but may set the stage for later impacts, nonetheless still trigger the duty.^[8] Once important early decisions have been made, the logic goes, this may create “a clear momentum” to move forward with a particular course of action, emphasizing the importance of early consultation at strategic decision-making stages.^[9]

In Clyde River and its companion case, Chippewas of the Thames, the Supreme Court provided even more precise limits: (1) the Crown must notify affected Indigenous peoples of its intent to rely on a regulatory process;^[10] (2) the process itself must align with the honour of the Crown, with agencies empowered to meet consultation and accommodation requirements;^[11] and (3) the Crown remains responsible for the ultimate outcome, obligated to supplement inadequate processes with case-specific or systemic measures such as legislative or regulatory amendments.^[12] In a hypothetical instance where the Crown has deliberately reduced or even eliminated the relevant regulatory process, element (3) seems to give rise to a somewhat circular logic.

Clyde River also directed that where environmental assessments are relied on, they must be applied with a view to assessing and mitigating impacts to rights, rather than merely impacts to the environment,^[13] adding an additional level of rigor to an already complex exercise. Accordingly, a further tool or trend that has since developed is an increased reliance on and deference to Indigenous-led environmental assessments.

In all, the judicial, economic, and practical trends alike lead inexorably to increased, rather than reduced, Indigenous involvement in major projects.

What Bill C-5 proposes—and what it leaves out

In contrast, Bill C-5 envisions building a list of recommended “national interest” projects eligible for streamlined regulatory requirements, with Indigenous consultation a precondition to recommendation for inclusion. One factor for cabinet to consider in this exercise is whether a project would “advance the interests of Indigenous peoples”.^[14] If added to the list, a duty is then imposed on the responsible minister to issue what appears to be an omnibus authorization document for the project, preconditioned again by Indigenous consultation, alongside consultation with responsible ministers about conditions and the proponent submitting necessary information and filing fees.^[15]

This scheme raises some important questions for all concerned.

First, what is to replace a regulatory review process that has been reduced or eliminated in the name of “streamlining” but through which Indigenous participation would have otherwise acted to assist the Crown in meeting its constitutional imperative? While Bill C-5 makes room for the Impact Assessment Act to apply in at least some instances, it also scales back its application, eliminating its important 180-day planning phase.^[16]

Second, the responsible minister’s statutory duty to issue an omnibus authorization document in that context raises the possibility of a conflicting scenario developing, where the Crown’s statutory duty owed to a proponent to issue the authorization may stand in the face of assertions that the Crown’s constitutional duty to Indigenous people remains unmet, risking tensions.

Third, it is unclear whether cabinet is equipped to determine whether a project “advances the interests of Indigenous peoples.” In this regard, the preamble to Bill C-5 states that Canada is committed to respecting both Indigenous rights and those included in the articles of the United Nations Declaration on the Rights of Indigenous Peoples.

The growing role of consent in project approvals

The articles of the Declaration, passed into federal law in 2021,^[17] emphasize a right of self-determination and, at least in some instances, require Indigenous consent when looking to exploit lands and resources.^[18] While some point to an oft-repeated judicial statement from Haida Nation that the Crown’s duty cannot extend to a “veto” in favor of Indigenous peoples,^[19] this principle does not serve as an answer to the expectations created by the text of the Declaration nor the quandary that something robust must replace the missing regulatory processes if the Crown’s constitutional imperative is to be met.

For example, as noted above, while Bill C-5 does require consultation before a recommendation for inclusion as a “national interest project” is even made, this arguably simply codifies Rio Tinto’s 15-year-old baseline requirement to consult regarding “strategic, higher-level decisions” capable of setting the stage and creating momentum for later, direct impacts to Indigenous lands and resources.

These questions await further clarity since exempting projects from regulatory review entirely, or making processes less robust, otherwise could, paradoxically, increase rather than reduce litigation risks, as inadequate consultation violates a constitutional imperative and, as stated in Clyde River, invites judicial intervention.^[20]

As noted, the incorporation of the Declaration into domestic law, referenced by Bill C-5 itself, adds further complexity. In one recent case, the Federal Court found that the Declaration’s consent-seeking requirements modified the nature of the duty owed by the Crown, demanding robust, tailored processes with a view to seeking mutual agreement, i.e. consent-seeking.^[21]

Obtaining consent could indeed be part of the solution. As the Supreme Court noted in the Tsilhqot’in case in the context of Aboriginal title, “[g]overnments and individuals proposing to use or exploit land, whether before or after a declaration of Aboriginal title, can avoid a charge of infringement or failure to adequately consult by obtaining the consent of the interested Aboriginal group.”^[22] Consent may also present unique issues for Indigenous peoples. For example, while Indigenous peoples may indeed choose the use to which title lands are put, lands cannot be encumbered or “developed or misused in a way that would substantially deprive future generations of the benefit of the land.”^[23]

Bringing it all together: A path forward

These issues are important and nuanced. The goals of nation-building, speed, and the pursuit of certainty hang in the balance, and may be better aligned with the Crown’s constitutional obligations if Indigenous interests are placed at the core of project planning and selection, including equity ownership, and robust consultation and consent-seeking efforts are put in place.

Over 20 years hence, these new efforts at regulatory streamlining have seemingly come full circle from Haida Nation and Taku River. Rather than asking the extent to which the Crown can rely on regulatory processes – these bills instead ask the extent to which they can be bypassed. And the prescient warning issued by the Supreme Court in Clyde River echoes louder than ever.

How Gowling WLG can help

Gowling WLG’s Indigenous Law and Infrastructure & Construction Law groups are deeply invested in helping our clients successfully navigate the challenges of completing projects, including regulatory compliance, consultations, consent-seeking, and Indigenous equity ownership. If you would like to discuss how we can help position your project for success, please contact the author at paul.seaman@gowlingwlg.com.