Between 9 December 2020 and 22 February 2021, the Standing Committee on Environment and Sustainable Development (the Committee) conducted a study about the investigation and prosecution of Volkswagen for its use of defeat devices in approximately 130,000 diesel vehicles imported into Canada. Through this lens, the Committee also investigated the enforcement of the Canadian Environmental Protection Act, 1999 (CEPA), which is Canada's main statute for protecting the environment and human health.

Enforcement officers from Environment and Climate Change Canada (ECCC) began investigating Volkswagen in September 2015 in relation to its use of defeat devices in certain diesel vehicles. The defeat devices—computer programs within vehicles that permit them to alter their level of emission controls in certain circumstances—allowed vehicles to meet national emission standards for nitrogen oxides under testing conditions, but to emit significantly more under regular driving conditions.

On 9 December 2019, Volkswagen was charged in Canada with 60 counts of contravening CEPA: 58 counts of unlawfully importing non-compliant vehicles and 2 counts of providing misleading information. On 22 January 2020, Volkswagen pleaded guilty to all charges and paid a fine of $196.5 million, the highest Canadian fine for environmental infractions to date.

Witnesses spoke about the way the Volkswagen defeat device case had unfolded in Canada. They shared their views on the timing and length of the case, on challenges faced by members of the public who wished to participate, and on transparency. Witnesses had differing views on what kind of charges would have been most appropriate and how they should have been organized, and on the extent to which the consequences to Volkswagen were commensurate with the nature of the crime. Witnesses shared information about the environmental and human health impacts of the pollutants that were emitted by the vehicles with defeat devices.

The study also addressed the implications of the Volkswagen case for the way CEPA is enforced. Concerns were expressed about the accessibility of civil enforcement provisions under CEPA and whether ECCC had the resources and willingness to investigate large polluters. Some witnesses suggested that, when possible, fines and penalties should be directed to projects that mitigate the specific damage caused by environmental crimes. Some witnesses discussed how the fines could be used in Canada to address air pollution and fund zero-emission vehicle infrastructure.

The Committee heard that ECCC is shifting towards a risk-based approach to environmental enforcement, which helps to ensure that its enforcement actions focus on the most serious cases of non-compliance with regulations. The Committee also heard that a high likelihood of conviction is a more important deterrent than the size of a fine.

The study identified several priorities for strengthening the enforcement of CEPA; these include increasing transparency, ensuring ongoing sufficient resources for enforcement operations, increasing the use of administrative monetary penalties and facilitating public participation in enforcement investigations.