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3 For additional information, please contact: Direction des communications Ministère des Ressources naturelles et de la Faune 5700, 4 e Avenue Ouest, C 409 Québec (Québec) G1H 6R1 Telephone: Toll-free: Fax: service.clientele@mrnf.gouv.qc.ca This publication is available on the Internet at: Ce document est également disponible en français. Legal deposit Bibliothèque et Archives nationales du Québec, ISBN (printed version) ISBN (PDF) Distribution code: Gouvernement du Québec

4 Message from the Minister of Natural Resources and Wildlife Our forest sector is at a crossroads, facing all the major challenges of our time, which include economic and regional development, international competition, sustainable development, climate change, the cohabitation of various communities and First Nations, and workforce availability and training. All these challenges are present in the forest sector, and have an impact on the workers and communities that derive their living and their pride from the forest. On February 14, 2008, we published the Green Paper entitled Forests: Building a Future for Québec, which sets out the Government s vision of the changes needed to give new impetus to the forest sector. The Green Paper s proposals were the subject of province-wide and regional consultations, as well as consultations with the Aboriginal communities. This document follows on from the consultation phase, and presents more detailed measures that could be applied as part of a new forest regime. The comments made during the consultations have fuelled the thinking process in recent months. The measures proposed here confirm the Government s intention to propose a new forest regime that will not only guarantee sustainable forest development, but will also encourage innovation at every level, from logging to product processing. The document also presents a number of methods that could be used to achieve the objectives of the review process. For example, we propose the adoption of a sustainable forest management strategy, the creation of public forest management corporations, the introduction of supply guarantees applicable to a percentage of allocated timber volumes (replacing the current timber supply and forest management agreement system), and the creation of a free market for wood from the public forest, using volumes that become available as a result of the changes. We also confirm our intention to improve forest production, among other things through intensive silviculture. The purpose of this document is to inform the general public and forestry stakeholders, all of whom are concerned about the future of the forest and the forest sector, about the methods that will be used to achieve our objectives. It examines these measures in detail, and will help build a future for Québec s forest sector. Claude Béchard Minister of Natural Resources and Wildlife Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 3

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6 Table of contents Introduction...7 Chapter 1 Review of the Nine Green Paper Orientations Forests: Building a Future for Québec Nine Orientations Summary of Public Consultation Results...12 Chapter 2 Foundations of the New Forest Regime Object of the New Forest Regime Sustainable Forest Management Strategy Delimitation of Public Forests Allowable Annual Cut Managerial Delegation Forest Management Corporations Supply Guarantees Wood Marketing Board Silvicultural Investment Fund Other Information...26 Chapter 3 Gradual Application of the Proposed Measures...29 Conclusion...30 Questions for Debate...31

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8 Introduction The current forest regime is more than 20 years old, and the Forest Act (R.S.Q., c. F-4.1) has been amended on numerous occasions since it came into force in In the meantime, the situation of forestry has changed significantly as a result of new knowledge, the emergence of new trends in conservation, integrated land and resource management and regionalization, and the onset of the crisis now facing the wood processing sector. As a result, the Minister of Natural Resources and Wildlife has decided to review the forest regime. A new forest regime is needed to meet society s expectations. The new regime must also be capable of addressing the various issues that forest management must necessarily overcome by taking a sustainable approach to the management and development of all the forest s resources. In the modern context, where an ability to adjust to change is essential, these issues include the strategic development of the wood processing sector, the desire of the regions to play a role in forest management, the need to increase timber yields, integrated land and resource management, the Aboriginal presence and traditional knowledge, and the fight against climate change. On February 14, 2008, the Minister published a Green Paper entitled Forests, Building a Future for Québec 1, which sets out the Government s vision of the review that is needed to give new impetus to the entire forest sector. Nearly 450 briefs and comments were received, and were consulted during preparation of this document, which clarifies the orientations presented in the Green Paper. Under the new regime, the industry will be released from some of its current responsibilities and costs. On the other hand, market forces will play a role through the wood auction system and transposition of prices to the wood offered through supply guarantees. The new forest regime should therefore not trigger a general increase in fibre costs in Québec, but should instead reflect the value placed on fibre by the companies themselves. A report on the methods and impacts of the new wood marketing system will be available in July This working paper is divided into three sections. The first section summarizes the nine orientations proposed in the Green Paper and presents the consultation mechanism along with a summary of the consultation outcomes. The second section sets out the elements the Government would like the general public and forest stakeholders to consider before the proposed new forest regime is finalized. These elements include the object of the new regime, the adoption of a sustainable forest management strategy, delimitation of public forest areas, the allowable annual cut calculation, delegation of forest management responsibility, the creation of forest management corporations, replacement of the timber supply and forest management agreements (TSFMAs) by supply guarantees, and the creation of a Wood Marketing Board and a Silvicultural Investment Fund. The third and final section presents a preliminary schedule for gradual introduction of the proposed measures. The various wood marketing mechanisms used throughout the world were analyzed in detail. The analysis served as a basis for establishing the basic elements of the new auction system for wood from the public forests, and for estimating the anticipated impacts on fibre costs in Québec. 1. Québec, Ministère des Ressources naturelles et de la Faune, Forests: Building a Future for Québec, Gouvernement du Québec, The Green Paper is available online (in French and English) at: Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 7

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10 Chapter 1 Review of the Nine Green Paper Orientations 1 Nine Orientations The following nine orientations form the basis of the review of Québec s forest management model. 1. Enhance resource development by implementing forest zoning Under this orientation, forest areas will be managed according to their potential. The orientation targets the definition of three separate categories of forest zones, namely protected areas, ecosystemic management zones (EMZs), which will be managed with a view to developing all forest resources, and intensive silviculture zones (ISZs), which will be dedicated to timber production because of their high potential. In the ISZs, priority will be given to treatments that will ultimately double timber yields. The investments required to achieve this would be protected by a specific status defined by law. 2. Refocus the MRNF on its primary responsibilities 3. Give regional authorities new responsibilities for managing the public forest The MRNF proposes a shift from centralized management of the public forest to a system that will give the regions some significant powers over the development of their forests. Under this orientation, an integrated land and resource management system will be set up for the public forest, and certain responsibilities will gradually be handed over to regional authorities over the next five years. Among other things, the regions will be given responsibility for the forest sector s contribution to community development. They will also be held accountable for the results. Fulfilling these new responsibilities will present some significant challenges, such as ensuring supply stability for the processing industry and planning forest management jointly with all the stakeholders. A further goal of this orientation is to encourage participation by the Aboriginal communities by giving them more opportunities to develop and prosper. Under this orientation, the MRNF s role as manager of the public forest will be refocused on strategic elements, leaving more room in the process for other public and private sector stakeholders. The MRNF s role will be refocused on its fundamental duties and responsibilities, including protection of the public interest in the public forest management process. The MRNF would continue to set the principal forest conservation and development objectives and regulate forest use where necessary. It would also continue to fulfill its responsibilities towards the Aboriginal communities, but would entrust certain planning, monitoring and control activities to other authorities. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 9

11 4. Entrust forestry operations to certified forestry companies 6. Promote a stable supply of timber by introducing a right of first refusal Under this orientation, the MRNF will recognize the forest management industry as a key player in the planning and performance of forestry operations, in order to increase quality. The regional authorities will grant agreements on the basis of a set of rules that will allow for healthy competition between forest management companies. 5. Promote a management approach based on sustainable results and accountability of managers and foresters For forest resource use in Québec to meet the demands of sustainable development, it is essential for the individuals and organizations concerned to have the flexibility they need to solve the range of problems they will face. The purpose of this orientation is to ensure that forest resources are in fact used in a way that is consistent with the demands of sustainable forest management. It also aims to make the forest management process more dynamic and to improve the forest management, environmental, social and economic performance of the stakeholders concerned. To achieve these goals, the MRNF proposes a number of additional measures, including management by objectives and by results, application of the concept of ecoconditionality and certification of forestry practices by independent third parties. Under this orientation, the current approach based mainly on timber supply and forest management agreements (TSFMAs) will be dropped in favour of a right of first refusal over certain volumes of timber from the public forest. This right will give TSFMA holders priority to purchase, at its market value, a specific volume of timber corresponding to a percentage of their former allocation, based on the principle that their basic supplies will come from the private forests and the remainder from the public forests (the principle of residuality ). The total volumes of wood from the public forest to which the right of first refusal will apply will be calculated only after determining: The quantities of wood required to ensure that a competitive market is able to function properly and establish a true market value for the wood; and The quantity of wood required by the Minister in the short term to meet needs other than the supply of wood processing mills. In the transitional phase, rights of first refusal will be offered only to TSFMA holders. Subsequently, however, other wood processing companies will be able to apply for these rights, provided the necessary volumes are available. 10

12 7. Establish a competitive market for timber from the public forests This orientation depends on the introduction of a right of first refusal. The goal is for the price of wood harvested in the public forest to reflect its true market value. If prices were established on the basis of a competitive market, Québec s industry would be in a better position to deal with limitations on wood product exports. The market for public forest timber will be created in an orderly fashion to ensure that all companies, regardless of size, have an equal opportunity to obtain a share of the available volumes. Responsibility for this operation will be assigned to a public forest Wood Marketing Board. 8. Create a silvicultural investment fund for intensive silviculture The purpose of this orientation is to finance intensive silviculture in areas with high potential for timber production, in both the public and private forests. The fund will be managed by the MRNF, which will be responsible for allocating the amounts available to the regional authorities on the basis of yield objectives and the silvicultural work needed in intensive silviculture zones in both the public and private forests. The basic premise underlying this orientation is that the work required to restore basic production in logged areas of public forest ecosystemic management zones will be funded directly by wood sales. The Silvicultural Investment Fund will receive money from various sources, including the sale of timber by the marketing board, the leasing of areas for the creation of carbon sinks, and possibly from private sources that are not currently utilized. On a strong market, the surplus generated by timber sales will be paid into the fund as a priority, and where applicable will contribute to Government revenues. 9. Establish an industrial development strategy based on high value-added products The purpose of this orientation is to establish an industrial development strategy based on high value-added products to maintain an innovative industry able to create wealth and longterm jobs, and to encourage the use of wood as a material by the population of Québec. The strategy will target development of the wood sector, the energy sector and the bio-refining sector. Among other things, it will aim to increase the use of wood as a construction material in the non-residential sector, and encourage more frequent use of wood as a decorative material in construction and renovation projects. The biomass available from Québec s forests will also be developed as a source of energy production. New forest biomass processing technologies will be used to develop value-added products such as pyrolytic oils, biodiesel, methanol and ethanol. Measures will also be introduced to modernize the primary processing sector, shorten the new wood product development sector and encourage the creation of regional networks. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 11

13 2 Summary of Public Consultation Results The Green Paper s proposals were subjected to a province-wide and regional consultation process, as well as consultations with the Aboriginal communities, all of which ended on March 28, The regional conferences of elected officials (commonly known by their French acronym CRE) were responsible for organizing the regional public consultations, which generated approximately 300 briefs. As a result, the CREs were able to inform the Minister of their respective regions positions. Nearly 155 other briefs were sent directly to the Minister, including approximately 30 from national bodies and eight from Aboriginal communities and organizations. Generally speaking, the Green Paper was well-received. The vast majority of consultation participants agreed that a reform of the current regime was necessary. However, although there was some consensus on the objectives and general principles of the reform, participants were nevertheless hesitant in some cases to express their opinions of certain proposals, asking instead for additional information on the mechanisms that would be used to implement the proposed changes. Several participants mentioned the need for clarification of these mechanisms, and this working paper provides that clarification. Opinions of the regional conferences The CREs supported the Government s intention to entrust the regions with responsibility for public forest management. Most were in favour of the proposal to create new authorities for this purpose, although they did not agree on a model for those authorities. The CREs also agreed with the proposed forest zoning system, including the introduction of intensive silviculture zones. They would like the zone selection process to take place in the regions. Reactions to the proposal concerning the right of first refusal and the creation of a free market for wood were somewhat mitigated. The CREs that were in favour asked to be included in the process, since they were concerned about the limited number of companies that would be able to purchase wood. Some CREs requested impact studies, and suggested selling the wood in the form of standing timber. Other suggestions included allowing the industry to be responsible for logging, transportation and roads. Opinions of Aboriginal communities and organizations The handful of communities that submitted comments on the Green Paper reacted differently to the Government s proposal to hand over certain forest management responsibilities to regional authorities. Those that were in favour of the proposal mentioned the possibility of making new business contacts, although their support was conditional on the continuation of the current government-to-government relationship in negotiations between Québec and the First Nations. Some Aboriginal communities were open to the introduction of a forest zoning system aimed among other things at intensifying silvicultural operations in productive areas, provided their traditional activities could continue and acknowledged treaty rights would be upheld. 12

14 Opinions of national organizations (National Table) The National Table 2 members were in favour of the proposal to entrust the regions with responsibility for public forest management. However, they expressed concern regarding the possibility of conflicts of interest in the wood allocation process, and regarding the decision to delegate operational planning to the new regional authorities. The trade unions thought the MRNF should test the efficiency of the proposed model before implementing it. The groups in favour of the proposal also mentioned the need to provide additional details on the division of responsibility between the MRNF and the regional authorities, as well as on the accountability process for the regional authorities. Most of the national organizations that expressed opinions on the forest zoning proposal were in favour of it. However, the proposal concerning the right of first refusal revealed a number of significant differences between members representing the industry and those representing workers; some wanted the TSFMAs to be maintained, while others were in favour of abolishing them. The comments made during the consultations provided food for thought during the process leading up to production of this working paper, which sets out a series of measures that follow on from the Green Paper s orientations. Specific discussions could be organized with the communities concerned and with the Cree-Québec Forestry Board, to ensure that the new forest regime is respectful of the objectives set out in the Agreement concerning a New Relationship between the Gouvernement du Québec and the Crees of Québec in areas covered by the Agreement. 2. The National Table is a forum composed of approximately 50 national associations and organizations with an interest in forest management and development issues. It is chaired by the authorities of the Ministère des Ressources naturelles et de la Faune, and is asked to discuss ministerial orientations on a regular basis. After discussion, members are asked to submit their individual recommendations to the Minister. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 13

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16 Chapter 2 Foundations of the New Forest Regime 1 Object of the New Forest Regime 2 Sustainable Forest Management Strategy The orientations set out in the Green Paper entitled Forests, Building a Future for Québec, were devised with a view to introducing a new forest regime by April 1, The reform is based to a large extent on the principles of sustainable forest management, and its aims are to hand over operational management of the public forest to regional authorities, and to create a competitive market for wood from the public forest. The measures proposed as part of the reform include the following: Prepare a sustainable forest management strategy to govern public forest management; Review the boundaries of the public forest to ensure that they reflect regional territories, and to target intensive silviculture zones; Review the basic rules governing the allowable annual cut calculation, to bring them into line with the principles of sustainable forest management; Delegate some of the responsibility for public forest management to regional authorities; For each region or group of regions in Québec, provide for the creation of public forest management corporations that will be responsible for planning and carrying out forest operations; Replace the timber supply and forest management agreements (TSFMAs) granted under the Forest Act by supply guarantees that will provide secure supplies for wood processing mills holding TSFMAs in 2013; Set up a Wood Marketing Board to be responsible for selling wood and other products from the public forest at prices that reflect their true market value; Create a Silvicultural Investment Fund. Like the measures contained in the current version of the Forest Act, those proposed in the reform must allow for recognition of the forest heritage and sustainable forest management so that the health of Québec s forest ecosystems can be maintained and improved in the long term, while providing environmental, economic and social potential for present and future generations. Sustainable forest management should also contribute to: 1. the preservation of biological diversity; 2. the maintenance and improvement of the condition and productivity of forest ecosystems; 3. the conservation of soil and water resources; 4. the maintenance of the function of forest ecosystems as a component of global ecological cycles; 5. the maintenance of the multiple socioeconomic benefits society derives from forests; 6. the giving of proper consideration, in selecting forms of development, to the values and needs expressed by the populations concerned. To do this, the new regime may provide for the Minister to adopt a sustainable forest management strategy that promotes an ecosystemic approach along with integrated land and resource management. The strategy would present orientations, objectives and targets for sustainable forest management, applicable to all the parties involved in managing the public forests. It would also set out the conditions for implementation at the regional level, and for planning by the forest management corporations. The strategy will be made public, and will be reviewed if the Minister feels changes are required to foster sustainable forest management. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 15

17 At the regional level, the regional conferences of elected officials, created pursuant to the Act respecting the Ministère des Affaires municipales et des Régions (R.S.Q., c. M-22.1), would produce a public document setting out the specific objectives for implementation of the strategy in their respective regions, along with the activities to be carried out directly or in collaboration with one or more regional stakeholders for example, the forest management corporations, regional county municipalities or Aboriginal communities. To do this, the CREs could use the integrated regional land and resource development plans currently being prepared by the regional land and natural resource boards (RLNRBs) under their authority, by virtue of an agreement with the Minister of Natural Resources and Wildlife and the Minister of Municipal Affairs and the Regions. Management unit boundaries will be amended using the same procedure as for their initial creation. The management units will be composed of areas intended for timber production and areas intended for other uses. In the areas intended for timber production, priority may in some cases be given to intensive silviculture. The ecosystemic management approach, designed to protect biodiversity and the viability of all forest ecosystems while meeting social and economic needs with due respect for social values, will be applied throughout the management units. Areas intended for other uses will include: 1. Protected areas, including those mentioned in the Natural Heritage Conservation Act (R.S.Q., c. C-61.01) and the Parks Act (R.S.Q., c. P-9). 2. Exceptional forest ecosystems; 3. Biological sanctuaries; 3 Delimitation of Public Forests The new forest regime will propose rules governing the division of the public forest into management units or local forests. The purpose of this is to ensure better regional representation. It will also include specific rules for certain forest zones within the management unit, giving precedence to timber production. Management units The management units will comprise areas of forest used for forest management purposes, according to their assigned allowable annual cuts. They will be located south of the boundary determined by the Minister, and will be established on the basis of administrative region territories, territories used by Aboriginal communities, biophysical features and other land uses. Before establishing the management unit boundaries, consultations will be held with the Chief Forester, the forest management corporations, other Ministers, national and regional organizations and the Aboriginal communities concerned. The unit boundaries will be made public, on maps available from the MRNF s Website. 4. Forests created for experimental, educational and research purposes; 5. Areas used as carbon sinks. Intensive silviculture Intensive silviculture zones will be created within the areas intended for timber production in each management unit. The creation process will start by defining the criteria to be used by the Minister to identify areas with high potential for timber production. A plan showing the locations of these areas will then be sent to the CREs for regional consultation purposes. The CREs will then identify the zones where intensive timber production would take precedence. Lastly, the Minister will designate the intensive silviculture zones and make maps available showing their geographical boundaries. The zones will be included in the land use plan prepared pursuant to the Act respecting the lands in the domain of the State (R.S.Q., c. T-8.1). Zones will be added or removed from the list, and zone boundaries will be altered, using the same process as for their original creation. 16

18 4 Allowable Annual Cut Local forests Certain areas of the public forest will be designated as local forests, in order to foster local or regional socioeconomic development projects. A ministerial policy will be adopted to establish the criteria on which designations will be based. Prior consultation of the Chief Forester and the government departments, regional authorities and Aboriginal communities concerned will be required. The forest management corporation may also be consulted. The ministerial policy and list of designated local forests will be published, and the boundaries of the local forests will be shown on maps available from the MRNF Website. Local forest boundaries will be altered using the same procedure as for their original creation. Responsibility for managing the local forests will be handed over to municipalities or Aboriginal band councils, by virtue of the provisions set out in Section 5. The allowable annual cut has been used for the last 20 years to calculate the volume of wood that can be sustained by the forest, over time, to supply the forest industry. The calculation takes into account other aspects of the forest environment (e.g. the biological features to be preserved, land use, habitat protection and development requirements, etc.). However, it does not guarantee the sustainability of all the forest s various components. This document proposes a number of measures that will be used to review the existing approach from a different standpoint. In future, the allowable annual cut will be designed primarily to maintain the forest s sustainability, based on its natural dynamics (composition and age structure), and then with a view to sustaining productivity. This new approach will be used to calculate the annual level of operations (logging and silvicultural work) required to maintain or improve all the benefits available from the forest. The allowable annual cuts will be revised every five years and updated as necessary by the Chief Forester, based on the same criteria as for the original calculation. They may also be increased or, if sustainable forest management is compromised, decreased at any time, on the recommendation of the Chief Forester and at the request of the Minister. The allowable annual cuts, the dates on which they come into force and the parameters and reasoning on which they are based, will be published by the Chief Forester. All parties responsible for planning and carrying out forestry operations will be required to comply with the allowable annual cut. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 17

19 5 Managerial Delegation The Government s role in the forest has evolved over the decades, reflecting changes in Québec society as a whole. Under the current Forest Act, forest resources are managed centrally, and the regions and agencies are involved through public consultations and other participatory processes. Their participation has taken a number of different forms over the years, including management of intramunicipal public land by the RCMs, management of regional forestry programs by the CREs, and so on. The MRNF recently created the regional land and natural resource boards, through which the regions and Aboriginal communities are able to play a more direct role in public forest management, giving them greater control over their development and the ensuing benefits. To foster regionalized management of the public forest, the new forest regime will grant the Minister the power to delegate certain forest management responsibilities including forest planning, operations, monitoring and control to Aboriginal band councils, municipalities, legal persons and other bodies, by means of agreements. The delegation agreements, which will be made public by the Minister, will include the following elements among others: 1. The territory in which the delegated responsibilities will apply, and the obligation to obtain certification for all or part of that territory from an independent organization, based on recognized sustainable forest management standards; 2. The responsibilities being delegated; 3. The objectives and targets to be achieved, including effectiveness and efficiency targets and objectives, as well as the data or information to be provided, including those the Minister feels are necessary for the functions of the Chief Forester and the Wood Marketing Board. 6 Forest Management Corporations Although there are already a number of regional players in the forestry sector, an additional presence is nevertheless required to ensure that the regions are able to fulfill their new responsibility of managing and operating Québec s public forest. The new forest regime therefore grants the Government power to constitute forest management corporations that will be responsible for managing their region s public forests in a sustainable way. These corporations will be legal persons acting as agents of the State. They will have access to the MRNF s expertise, through transfers or other forms of collaboration yet to be determined. In carrying out their mission, the corporations will adopt an ecosystemic approach and apply integrated land and resource management techniques. They will sign delegation agreements with the Minister, defining their areas of responsibility. The corporations will also be required to respect the public forest boundaries established by the Minister, as well as the orientations, objectives and targets set out in the Sustainable Forest Management Strategy or agreed upon in the delegation agreement. The corporations must also meet the objectives set by the CREs, through the regional land and natural resource boards, for implementation of the Strategy, provided those objectives are compatible with the orientations, goals and targets established by the Minister and the allowable annual cut assigned to the management units located in their respective regions. 4. Special rules governing agreements granted by the assignee. 5. Accountability regarding targets and objectives; 6. The conditions of the Minister s power to supervise the assignee s management and to intervene when the objectives and targets are not met; 7. Sanctions in the case of default. 18

20 6.1 Functions of the corporations The corporations will be required to: 1. Manage their affairs effectively and efficiently, so as to keep timber costs as low as possible; 2. Implement and efficiently maintain an environmental management system recognized by the Minister; 3. Adjust the resource management, protection and development orientations, objectives and targets imposed by the Minister and by the CRE at the tactical and operational levels; 4. Produce five-yearly tactical orientation plans, based on the allowable annual cuts assigned to the management units located in the region they serve; 5. Plan forest operations in accordance with the tactical orientations; 6. Where applicable, plan forest operations in response to natural disturbances or the development of hydro-electricity or wind energy facilities, as indicated by the Government; 7. In collaboration with the Wood Marketing Board, identify the operational sectors whose the wood will be sold on the free market; 8. Establish a collaborative planning process that takes into account the interests and concerns of the individuals and organizations concerned, namely the regional county municipalities and, where applicable, the metropolitan community, Aboriginal communities represented by their band councils, holders of supply guarantees, individuals or organizations in charge of controlled harvesting zones or wildlife sanctuaries, and holders of sugar bush operating permits or outfitters permits, as well as the interests and concerns of any other individual or organization that must be considered in order to ensure integrated land and resource management; 9. Establish a public consultation process when preparing their plans; 11. Grant agreements for implementation of the proposed operations, thereby ensuring that forest management activities are entrusted to management companies that have obtained certification pursuant to a standard recognized by the Minister, or to management companies structured by the environmental management system of the corporation itself; 12. Supervise the management activities and smooth operation of the integration agreements signed with the holders of supply guarantees who decide to take responsibility for harvesting the volumes to which they are entitled; 13. Scale wood from the public forest and submit the scaling data to the Wood Marketing Board within the required timeframe; 14. Check the quality of forest management work, the achievement of targets and objectives and compliance with the forest management standards and all the other legislative and regulatory provisions that the corporations must apply, and demand corrective action where necessary; 15. Establish a process to settle disputes arising at the plan preparation or public consultation stages, or with the holders of supply guarantees; 16. Inform the Minister of any violation of a law or the related regulations, and collaborate with the investigators appointed by the Minister to prepare a penal case; 17. Collect information and data on forest management and forest operations, and submit them to the Minister in accordance with the Minister s requirements; 18. Produce and submit to the Minister, every year, an operational report in accordance with the Minister s requirements; 19. Submit to audit and control procedures and carry out the corrective measures imposed by the Minister. 10. Send the Minister a copy of the required plans within a reasonable time after they come into force, so that the Minister is able to fulfill the duty of consulting the Aboriginal communities affected by the plans; Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 19

21 The corporations may also: 1. Issue permits, leases and other rights, as determined by the Minister, and collect the related fees and expenses; 2. Administer any program entrusted to them by the Government or one of its departments or agencies in an area related to their mission, or assist in the preparation of such programs; 3. Enter into an agreement, in accordance with the law, with any person, municipality or organization, for the performance of their duties; 4. Acquire by mutual agreement, lease, sell or offer as security any movable or immovable property, any part of an immovable property, and any real right; 5. Receive gifts, bequests, subsidies and other contributions, provided that the related conditions are compatible with their mission; 6. Provide services and technical support in exchange for remuneration; 7. Exercise any other duty that may be assigned to them through an agreement with the Government or with the Minister. 6.2 Organization and operations The corporations will be administered by a board of directors composed of between 11 and 13 members, including the Board chair and the chief executive officer. Some members may be drawn from the following circles: 1. At least one member representing an Aboriginal community in the territory of the region served by the corporation, if any, appointed from a list of candidates proposed by the community or communities concerned; 2. Four members representing regional circles, appointed from a list of candidates proposed by the CRE concerned; 3. One member representing the forest industry, appointed following a call for nominations; 4. One member proposed by the regional wildlife table located in the territory of the region served by the corporation. The Government will appoint the members of the board, other than the chief executive officer, for a term not exceeding five years. The Government may also appoint persons to the board of directors to represent it, or to ensure a sufficient number of independent directors, or to obtain the profile of skills required for this type of organization. The members of the board of directors will elect a chair and a vice-chair from among themselves, to serve for a two-year term. The chief executive officer may not be elected to serve as chair or vice-chair. The members of the board of directors, other than the chief executive officer, will not be remunerated except in the cases and on the conditions established by the Government. They will, however, be entitled to reimbursement of any expenses incurred in the performance of their duties, on the conditions established by the Government. A chief executive officer, responsible for the corporation s direction and management, will be appointed by the board of directors. The position of chief executive officer will be full-time. Remuneration, fringe benefits and other conditions of employment will be established by a by-law of the corporation. An audit committee will be formed, along with any other committees that will be useful in achieving the corporation s mission. The quorum for meetings of the board of directors will be a majority of the board members, and decisions will be made by a majority of the votes cast by the members present. In the case of a tie, the chair will have a casting vote. The corporations may adopt by-laws for their own governance. Employees and a secretary may be appointed in accordance with the staffing plan established by by-law. 6.3 Inspection and investigation To fulfill their duty of supervising work in the public forest under their authority, the corporations will have the power to carry out inspections. For this purpose, they may: 1. Enter, at any reasonable time, a place which they have reasonable grounds to believe is used to store the information they need to fulfill their mission; 20

22 2. Examine and make copies of books, registers, accounts, files and other documentation containing information concerning the application of the legislation and regulations they are required to enforce; 3. Require any information concerning the application of the legislation and regulations they are required to enforce, as well as all related documentation. The corporations may also carry out investigations to fulfill their mission, and for that purpose they have the powers and immunity set out in the Act respecting public inquiry commissions (R.S.Q., c. C-37), except the power to impose a term of imprisonment. 6.5 Financial provisions The corporations will finance their activities out of revenues generated from the dues, expenses, commissions and fees that they may charge, as well as from the product of the goods and services they may offer, and any other monies they may receive. The monies received by the corporations will be used to finance their commitments. Every year, the corporations will submit their budget forecasts for the following year to the Minister, along with their budgetary rules. The forecasts will then be submitted for approval by the Government. 6.4 The Minister s power to intervene Although the corporations must have sufficient flexibility to operationalize management of the public forest, the new regime will include measures granting the Minister the power to intervene in order to ensure compliance with Government priorities. Accordingly, the Minister will have the power to issue instructions to the corporations, based on the objectives and targets contained in the Sustainable Forest Management Strategy or in the delegation agreement. The Minister may also demand corrective action in respect of the plans drawn up by the corporations, if such corrections are required to harmonize the plans with the rights of Aboriginal communities located in the regions served by the corporations. In addition, the Minister may appoint a conciliator, at the request of a corporation, to settle a dispute that the corporation in question has been unable to settle through its own dispute settlement mechanism. The conciliator will submit recommendations to the Minister within 30 days following his or her appointment. The Minister will make the final decision and will inform the corporation thereof within 30 days following receipt of the conciliator s recommendations. The Minister s decision will be binding upon the corporation in question. 6.6 Management and accountability The fiscal year of the corporations will end on March 31 each year. Every corporation must, no later than July 31 of each year, send a copy of its financial statements to the Minister, along with a report of its activities for the previous year. The report must include the following information, among other things: 1. A description of the results obtained as well as a comparison with the objectives and targets set in the Sustainable Forest Management Strategy and in their delegation agreements, with the regional objectives set by the CRE concerned, and with the objectives and targets established by the corporation itself in its tactical planning; 2. A description of any corrective measures or instructions imposed by the Minister; 3. A copy of the report from the independent organization responsible for verifying the corporation s environmental management system and sustainable forest management certificate; 4. A statement from the chief executive officer, attesting to the reliability of the data contained in the report, as well as any control measures applied. The Minister must table the financial statements and reports of the corporations in the National Assembly within 30 days following receipt thereof, or, if the National Assembly is not sitting, within 30 days of resumption. The books and accounts of the corporations will be audited by the Auditor General every year, and additionally as ordered by the Government. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 21

23 7 Supply Guarantees The current method used to allocate wood provides very little flexibility and is not entirely suited to the present context. The Minister has no leeway to respond to new needs (e.g. Aboriginal communities, proposed new processing companies, local forests, etc.). This flexibility could be achieved, however, by introducing a free market for wood from the public forest. The creation of a competitive market for wood from the public forest would involve some significant changes to the method used to allocate logging rights. 7.1 Replacing the timber supply and forest management agreement (TSFM) by a supply guarantee Beginning on April 1, 2008, the timber supply and forest management agreements granted pursuant to the Forest Act will be cancelled. Holders of the agreements will receive no compensation for the cancellation, except in respect of infrastructures built pursuant to a plan approved by the Minister (e.g. roads, bridges and forest camps). Compensation will be paid to the agreement holder by the Government for expenditures incurred for infrastructures in respect of which no subsidies or credits have been received. It will be based on the net value of the infrastructures after depreciation, according to the book values shown in the company s accounting registers, and upon presentation of vouchers. It may be paid in the form of a lump sum, or in the form of credits for the purchase of volumes of wood from areas of public forest, or in any other form determined by the Government. However, agreement holders may obtain supply guarantees, provided they apply for them before January 1, 2012, and provided they pay the required annual dues before April 1, The volumes of wood to which an agreement holder is entitled will be established by the Minister following a review of the timber supply and forest management agreements in accordance with the Forest Act. The volumes will, however, be reduced by a percentage to be established by the Minister, which may vary from one beneficiary to the next, depending on the species or groups of species concerned, the allocated volumes to which the holder would have been entitled on April 1, 2013 had its agreement not been cancelled, and the region in which the allocations are located. Special conditions may be imposed to ensure the survival of small and medium-sized enterprises. For example, the first 100,000 m 3 of fir, spruce, jack pine and larch (FSPL) or the first 25,000 m 3 of hardwood and other softwood species allocated may be subject to a higher level of guarantee than residual volumes. The Minister will publish the percentage reductions used to calculate the guaranteed annual volumes to which each holder is entitled. In establishing the percentage reduction, the Minister must ensure that sufficient quantities of wood are available to be sold on the market for wood from the public forest, in order to estimate its fair market value and allow for the implementation of local or regional socioeconomic development projects. The supply guarantee will indicate the guaranteed annual volumes of wood to which the holder is entitled, in each of the regions determined by the Minister. The guarantee will be entered in a public register created for that purpose, and will come into force on April 1, Supply guarantees for other wood processing mills After April 1, 2013, the Minister would have the power to grant supply guarantees to persons operating or proposing to operate a primary wood processing mill or a wood processing mill producing value-added products. The Minister must, however, ensure that the allowable annual cut is sufficient to grant a guarantee, that the volumes of wood available on the free market are sufficient to estimate the fair market value of wood from the public forest, and that such a measure is justified in the public interest. When making the decision, the Minister will give priority to mills producing value-added products, according to the quality of products produced. The Minister must ask the Wood Marketing Board for information on the minimum volumes of wood required on the free market to assess the fair market value of wood from the public forest, before granting a supply guarantee. The guarantee will come into force on the date on which it is entered in the public register created for that purpose. 22

24 7.3 Rights conferred by a supply guarantee A supply guarantee will give its holder the right to purchase, every year, a volume of wood from the public forest in one or more specific regions, in order to supply the wood processing mill for which the guarantee is given. The volume in question will be purchased at a price based on the rates set by the Wood Marketing Board. The annual volumes of wood subject to guarantees will be the residual volumes calculated by the Minister, based on the needs of the wood processing mill and on the other available sources of supply, such as wood from the private forests and local forests, wood chips, shavings, sawdust, wood fibres from recycling and wood from outside Québec. 7.4 Price of wood and annual dues The creation of a competitive market for wood from the public forest means that in future, wood will be purchased by the holder of a supply guarantee as part of the volumes covered by its guarantee, at a price calculated on the basis of the rates set by the Wood Marketing Board and in accordance with the timeframes and conditions established by the Minister. The holder must also pay annual dues to the Minister on April 1 of each year, or at the times and on the conditions determined by the Minister, in order to retain the guarantee. The amount of the dues will be fixed annually by the Minister using a method determined by regulation of the Government. Although the role of planning and carrying out forestry operations will be handed over to the forest management corporations, the holder of a supply guarantee may take responsibility for harvesting some or all of the volumes covered by the guarantee. It must, however, enter into an agreement with the corporation in question, allowing it to harvest the wood. The agreement must indicate the operational sectors, the conditions with which the guarantee holder must comply, and the name of the holder responsible for carrying out the work. The agreement must also indicate the conditions for coordination of harvesting and transportation functions, and provide for a decision-making mechanism and a dispute settlement mechanism for these activities and their related costs. The wood may be harvested by the guarantee holder if it is a certified management company or if it hires a company that is certified or covered by the environmental management system of the corporation in question. The rules currently set out in the Forest Act, allowing timber supply and forest management agreement holders to ship volumes of wood to wood processing mills other than the one mentioned in their agreements, may also apply to the holders of supply guarantees. Supply guarantees, like timber supply and forest management agreements, will be non-transferable. 7.5 Relinquishment of guaranteed annual volumes The holder of a supply guarantee may, during the course of a year, relinquish all or part of the volumes guaranteed for that year. However, any volumes relinquished by the holder will be taken into consideration when calculating the volumes covered by the guarantee. The supply guarantee will not entitle the holder to refuse, other than by relinquishment, any wood damaged by natural disturbance. In addition, the holder will not be able to claim an indemnity or compensation from the Government if, during a given year, the guaranteed volumes are unable to be offered in their entirety due to a natural disturbance or as a result of a decision by the Minister to limit or prohibit access to a forest road for reasons of public interest or public safety. However, when the volumes in question eventually become available prior to renewal of the guarantee, they must be offered to the holders who were originally entitled to them, proportionally to the volumes that were unavailable. The forest management corporation concerned may, after consulting the holder of the supply guarantee, establish a schedule setting out the dates on which the holder must make a decision concerning the purchase of the portion of the annual guaranteed volumes indicated by the corporation. Any holder that omits to Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 23

25 make the required decision concerning the purchase of that portion of the volume will first be notified of the consequences of its omission, and if it fails to act, will then be deemed to have relinquished the volume in question for that year. The notice sent by the corporation must state that the holder has a period of ten days to remedy the omission. The annual guaranteed volumes relinquished or deemed to be relinquished by a holder may, at the Minister s discretion, be sold by the Wood Marketing Board or shipped to one or more other mills, at a price calculated on the basis of the rates set by the Board. In the latter case, the Minister, when selecting the mills, will give priority to those that produce value-added products, based on the quality of the products produced. 7.6 Term, renewal and review of a supply guarantee A supply guarantee will be valid for a term of five years and will be renewed for a similar period, once every five years, provided the holder has fulfilled its obligations under the Act and the guarantee, unless otherwise indicated. Every five years, when renewing a supply guarantee, the Minister, after consulting the Wood Marketing Board and after giving the holder of the supply guarantee an opportunity to make comments, may review the conditions set out in the guarantee, if he deems it appropriate to do so, including the annual volumes covered by the guarantee and the territory from which the wood may be purchased. The Minister, at his discretion, may take the following factors into account: 1. The needs of the wood processing mill; 2. The other available sources of supply, including wood from the private forests and local forests, chips, shavings, sawdust, wood fibre from recycling and wood from outside Québec; 3. The volumes of wood from different sources used by the mill in the preceding five years; 4. The allowable annual cuts for the management units in question; 5. The minimum volumes of wood required for the free market, in order to assess the fair market value of wood from the public forest; 6. The volumes the Minister considers necessary for the carrying out of socioeconomic development projects in the regions and communities. During the year, after giving the holder of the supply guarantee an opportunity to make comments, the Minister may also revise the species or group of species for that year s guaranteed volumes, and the territory from which the wood may be purchased, if the allowable annual cut for a given management unit in a region to which the guarantee applies is reduced during the year by the Chief Forester. The same applies in the case of changes in the needs of the holder s wood processing mill, for example as a result of a change in control of the legal person or company holding the guarantee, definitive assignment of a portion of the mill s activities, a change in the mill s mission or restructuring of the company. In addition, if the allowable annual cut for a management unit located in a region to which several supply guarantees apply must be reduced, the Minister, when dividing the reduction in the annual guaranteed volumes of the species or group of species concerned among the guarantee holders, may consider the impacts of the reduction on regional or local economic activity, and may vary the reduction accordingly. 7.7 Termination of a supply guarantee Cancellation of supply guarantees will be governed by rules similar to those currently applicable to timber supply and forest management agreements. Holders who ask the Minister to terminate their guarantees will be entitled to reimbursement of a portion of the annual dues corresponding to the surplus amount paid. In addition, the Minister, when terminating a supply guarantee, may, for the time remaining before the next five-yearly review of allowable annual cuts, either allow the wood to which the guarantee applies to be sold by the Wood Marketing Board, or send the wood to one or more other mills at a price calculated on the basis of the rates established by the Board. In the latter case, the Minister, when selecting the mills, will give priority to those that produce value-added products, based on the quality of the products produced. 24

26 8 Wood Marketing Board The MRNF proposes that a portion of the wood harvested in the public forest should be sold on a free market. The purpose of this is to enable all potential purchasers (primary processing mills, whether or not they hold supply guarantees, secondary and tertiary processing mills, silvicultural companies, etc.) to acquire wood from the public forest. In addition, it will be possible to establish the fair value of wood from the public forest, provided a sufficiently large volume is sold. The new forest regime will create an administrative unit within the MRNF to be known as the Wood Marketing Board, whose principal function will be to perform the operations required to sell wood and other forest products from the public forests. To ensure proper control, management and operation of the Board, the Government will appoint a person to be responsible for it, using a selection process to be determined at a later date. The person would be appointed to the position of associate deputy minister, in accordance with the Public Service Act (R.S.Q., c. F ), for a term of five years. The term may be renewed by the Government. The Wood Marketing Board will have the following functions, among others: 1. Collect the forest-related, biophysical, financial and economic data required to assess the market value of the wood and other forest products from the public forest, and to assess the cost of forest operations; 2. Perform the operations required to sell wood and other forest products from the public forest and prepare a manual for clients, setting out the principal rules applicable to the sale of wood and other forest products; 3. Establish the conditions and frequency of sales of wood and other forest products, including the conditions of allocation; 5. Sell by public auction or another means, on a free market, other forest products from the public forest in order to assess their fair market value; 6. Where applicable, fix the reserve price based among other things on the cost and profitability of management activities; 7. Assess the market value of the wood to be offered to the holders of supply guarantees, and set the applicable unit rates; 8. Invoice the wood and other forest products from the public forest, and collect the revenues from the sales. The Board may also advise the Minister on aspects related to his duties, including: 1. The minimum volumes of wood required on the free market to assess the fair market value of wood from the public forest; 2. The efficiency objectives and the information and data required from the forest management corporations for the purpose of the Minister s duties; 3. The planning and development of markets for wood and other forest products. The Minister may, in addition, entrust the Board with any other mandate relating to an aspect of its duties, including requesting its opinion on any issue relating to such an aspect in the public or private forests. The Board will assess the market value of wood and other forest products from the public forest, including the market value of wood damaged by natural disturbance, by species or group of species, by quality class, by size and by zone, using the method and at the interval determined by regulation of the Government. Based on its assessment, the Bureau will then fix the unit rates of the market values and publish them on the MRNF s Website. 4. Establish and sell by public auction or another means, on a free market, the volumes of wood from the public forest required to assess the fair market value of the wood and identify, in collaboration with the forest management corporation in question, the operational sectors whose wood will be sold; Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 25

27 The new auction mechanism will enable market prices to be obtained for wood from the public forest. The prices obtained will serve as a comparable reference when calculating the dues payable for wood covered by supply guarantees. A statistical analysis of the sale prices and characteristics of all the wood sold throughout Québec will be used to build a simple market price transposition model for each of the main species groups in the public forest. These simple, transparent models will then be used to establish dues for each zone, by directly transposing the prices obtained on the free market. The Board may carry out investigations as part of its duties. In such cases it would have the powers and immunity stipulated in the Act respecting public inquiry commissions, except the power to impose imprisonment. 9 Silvicultural Investment Fund The purpose of the silvicultural investment fund will be to finance intensive silviculture in certain target areas with high timber production potential (i.e. the intensive silviculture zones or ISZs), in order to increase forest yields. In addition, the financing mechanisms will contain incentives for more effective forest operations. 10 Other Information 10.1 Aboriginal affairs This working paper confirms the Government s desire to give the regions more control over their development and to bring the decision-making process closer to the communities that depend on the forest for their livelihood. This includes the Aboriginal communities. This document proposes that they should be involved in managing the new forest management corporations. In doing so, they will ensure that their needs are given adequate, informed consideration, and will also contribute to their own development. The forest management corporations would be an excellent vehicle for playing a key role in decisions, setting development objectives, maintaining or forging business contacts and voicing specific concerns. Involvement of the Aboriginal people in the forest management corporations would in no way release the Government from its obligations. Consideration of the concerns of Aboriginal communities and respect for their rights (e.g. Peace of the Braves, etc.) will continue to be both a responsibility and a priority for the MRNF and the Government. Accordingly, the nation-to-nation relationship maintained between the Aboriginal communities and the Government would not be called into question or altered in any way by the proposed reform of the forest regime. The Silvicultural Investment Fund will be managed by the MRNF, which will be responsible for dividing the available monies between the corporations, based mainly on yield objectives. The remainder of the monies will be divided on the basis of economic and forest-related efficiency criteria and performance criteria, in order to create management incentives for regional authorities. The Fund s revenues will come from the sale of wood, contributions from the Gouvernement du Québec and possibly from the federal government, net revenues from carbon credits and forest biomass, and various contributions from private partners Industrial development strategy In the wake of the Summit on the Future of Québec s Forest Sector, held in December 2007, and publication of the Green Paper, the Government proposes to adopt an industrial development strategy with four specific areas of focus: The energy sector; The biorefining sector; Modernization of basic sectors; The wood sector. The strategy for the use of wood as a construction material in Québec, published on May 28, 2008, is one of the mechanisms designed to promote the development of the wood sector. It is the first action plan in the new government policy to encourage the production of high value-added products. 26

28 The aim of the strategy is to create a profitable economic activity and stimulating, sustainable jobs, foster innovation in the forest sector, increase the use of wood as an ecological material and reduce greenhouse gas emissions. The strategy also reflects the government s desire to change the public perception of the forest products sector. A further goal of the strategy is to increase end-user consumption of wood in Québec s construction sector by a volume equivalent to the production of two large sawmills. It also aims to reduce greenhouse gas emissions by nearly 600,000 tonnes, or the equivalent of the annual emissions of nearly 50,000 people in Québec. A budget of $16 million over six years will be made available for the strategy Integrated land and resource management 10.4 Management focused on sustainable results The issues surrounding forest management have become more complex over the years. When managerial responsibility is delegated to the forest management corporations or local forest managers, they should also be given the flexibility required to accomplish this task. Flexible rules will be required to provide some operational leeway, and management focused on sustainable results should be given priority. This does not mean the Government should not provide points of reference, guidelines and control mechanisms. On the contrary, the contractual agreement should clearly stipulate the limits of the delegated powers, the objectives and targets to be achieved and a strict liability to perform. This new business relationship will allow for a shift from directive (means-based) management to management by objectives and by results, and will involve a significant change of culture, for both the MRNF and its partners. The forest management process must consider all forest resources by involving users in decisions concerning management choices. Several measures in the current forest regime are designed to harmonize forest management activities with the activities of other land and resource users. This working paper suggests that the coordination effort at regional level be continued by fostering consideration of the concerns expressed by interest groups in the planning of forest management operations, as far upstream in the process as possible. The creation of issues tables as part of the management plan production process will help attain a balance between the different values associated with the forest and achieve harmony among the various users. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 27

29

30 Chapter 3 The ultimate goal is to ensure that the revised forest regime comes into force between 2013 and It is vital to ensure the continuity of planning activities and forest operations, in spite of the change of regime. Consequently, the numerous proposed measures must be implemented according to a schedule beginning in 2009, so that the regime itself is able to come into force at the appropriate time in The Sustainable Forest Management Strategy, which will structure and direct the various management measures, should therefore be prepared and adopted in the coming year. This preliminary step is vital to ensure that subsequent measures are consistent with the orientations, objectives and targets set in the Strategy. The process leading up to the creation of forest management corporations should begin in 2009, so that the new entities are in a position to fulfill their various mandates. The Act will stipulate the terms and conditions for the creation of the corporations, including transitional measures that will allow them to begin operations by In addition, certification of silvicultural companies, certification of forest land and the introduction of certified environmental management systems for the management corporations should be finalized before 2013, to comply with the conditions for delegation of forest management activities. The forest management corporations will have the tools they need to perform their duties effectively. A gradual handover of responsibility to the forest management corporations can then be envisaged. Between now and 2013, the MRNF should refocus on its responsibilities and mandates at the time the new regime comes into force. This shift will require organizational and functional changes in the short-term. In addition, certain programs including the Forest Resource Development Program, the Forest Job Creation Program, the Silvicultural Investment Program and the Private Forest Development Support Program must all be revised to see whether they are capable of achieving the new goals, especially those set out in the Sustainable Forest Management Strategy and the new regime. Gradual Application of the Proposed Measures The Wood Marketing Board that will be responsible for selling wood from the public forest should be set up in early It would then have time to structure and establish its operational procedures, and would be in a position to become fully operational in Experimental wood auctions should preferably be held before To follow up on the Government s intention of intensifying silviculture, as stipulated in the Green Paper, this working paper confirms the creation of intensive silviculture zones. The process of identifying these zones should be completed by 2010, so that silvicultural work can begin as soon as the zones are known. The funds available for this task could be increased gradually, until a level of operation is reached that would guarantee an increase in timber production. The new regime should not cause fibre costs in Québec to rise beyond their present levels. The industry would be released from some of its current responsibilities and costs (e.g. planning, silvicultural work, access roads). On the other hand, market forces would be brought into operation through the wood auction system and the application of market prices to guaranteed volumes. In other words, the companies themselves will set the price of the resource, based on supply and demand. Although it is not possible to predict market conditions in 2013, it is nevertheless clear that the auction mechanism will be more effective than the current system, based on private forest stumpage, in enabling prices to adjust to market forces. Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 29

31 Conclusion This working paper presents detailed descriptions of many of the measures required to give concrete form to the orientations set out in the Green Paper entitled Forests, Building a Future for Québec. In some cases, these measures will form part of the new Act governing the occupation of forest land in Québec for example, those concerning the corporations that will be created to manage public forests at the regional level, the new conditions to ensure supply security for the wood processing mills, and the provisions concerning creation of the Wood Marketing Board for wood from the public forest, among others. The purpose of this document is to provide information for the general public and forest sector stakeholders on the review of the forest regime that began in the winter of In addition, a report on the conditions and impacts of the new wood marketing method will be available in July The parliamentary standing committee will continue the process in the fall of 2008, and the Government will draw up a draft bill revising the Forest Act, which should be tabled and adopted before the end of 2008, so that the new legislative provisions can be brought into force gradually, beginning in

32 This document is intended to provide information for both the general public and the individuals and organizations affected by the reform of the forest regime about the current status of work leading up to the adoption of a new Act to establish a modern, effective forest system. The following questions will provide food for thought, and will fuel the public debate with a view to completing the impact assessments and perfecting the legislative provisions to be proposed in the fall of 2008.??? Questions for Debate 1. Are you in favour of the adoption of a Sustainable Forest Management Strategy based on an ecosystemic approach and integrated forest resource management, setting out the orientations, objectives and targets for the management of Québec s forests? At this stage, do you have any suggestions concerning the Strategy s content? 2. Are you in favour of the proposal to create intensive silviculture zones, based on the recommendations made by the regional conferences of elected officials (CREs) to the Minister of Natural Resources and Wildlife, after consulting regional stakeholders? 3. Are you in favour of creating local forests to be managed by local municipalities, RCMs or Aboriginal communities under agreements with the MRNF? The working paper sets out the elements to be covered by the agreements. Are there other elements that you think should be added? 5. It has been suggested that timber supply and forest management agreements (TSFMAs) should be replaced by supply guarantees. Are you in favour of this measure? 6. As proposed in the Green Paper, some of the wood from the public forest will be sold on a free market by a Wood Marketing Board. This document sets out the composition of the Board, along with its responsibilities. Do you agree with these proposals? 7. The working paper suggests a gradual implementation of the revised forest regime. Do you have any recommendations concerning the timeframe? 4. The Green Paper entitled Forests, Building a Future for Québec suggested delegating a number of public forest management responsibilities to the regions. Are you in favour of the new forest management corporations proposed in this working paper (i.e. regional corporations administered by a board of directors representing the regional forest community)? The working paper also lists the tasks that would be entrusted to these corporations. Do you have any comments or suggestions to make on any of these aspects? Working Document The Occupation of Forest Land in Québec and the Constitution of Forest Management Corporations 31

33