Prince Edward Island Shellfish Aquaculture Leasing Policy

Effective Date:  June 13, 2022
Revision Date: June 19, 2023
Revision Number: 1

1. Introduction

Purpose

The purpose of the Prince Edward Island Shellfish Aquaculture Leasing Policy (the Policy) is to:

• address the needs of the shellfish aquaculture (aquaculture) industry on Prince Edward Island (PEI) with respect to allocation of new leases and the management of existing leases
• address the needs of the aquaculture industry on PEI with respect to allocation of new molluscan spat collection licences (spat licences) and the management of existing spat licences
• provide industry representatives and other interested stakeholders with a clear, consistent statement of Fisheries and Oceans Canada (DFO) policy regarding the issuance and management of aquaculture leases in the waterways of PEI

General policy statement and scope

This policy applies to aquaculture leases located in tidal waters surrounding PEI. Leases are issued for commercial aquaculture production or production for the purpose of enhancing the public resource.

Governance

DFO has been delegated responsibility for the administration of aquaculture leasing in PEI as described in the Canada-Prince Edward Island Memorandum of Understanding for Commercial Aquaculture Development (MoU). The MoU was originally signed in in 1928 and renewed in 1987.  

A management and funding framework for aquaculture leasing on PEI was established in 1999. Per the framework, aquaculture leasing on PEI is jointly managed and funded by DFO and the Government of PEI.

The Aquaculture Coordinating Committee (PEIACC) has been established under the authority of the MoU. The PEIACC is comprised of the DFO Regional Director General, Gulf Region (RDG) and the provincial Deputy Minister from the provincial department responsible for aquaculture (Government of PEI). The PEIACC provides direction and approval to the various subcommittees under the MoU structure.

Industry consultation and guidance on the Policy related to shellfish aquaculture leases is received through the PEI Shellfish Aquaculture Management Advisory Committee (PEISAMAC; formerly the PEI Aquaculture Lease Management Board).

Two other committees assist in delivering the program. The PEI Shellfish Aquaculture Leasing Referral Committee (PEISALRC) and the PEI Shellfish Aquaculture Leasing Appeals Panel” (PEISALAP). The PEISALRC is a federal/provincial committee mandated to assess applications in accordance with this policy and the Gulf Region Molluscan Spat Collection Operational Policy to provide DFO with recommendations to approve, approve with amendments or deny applications. The PEISALAP is a committee that reviews requests from current leaseholders, spat collection licence holders, lease and spat collection licence applicants, who wish to appeal a decision taken by the Department regarding a lease or spat licence application.

Objective

DFO and the Government of PEI seek to promote sustainable co-existence between aquaculture industry stakeholders and other users of the marine environment. This policy, and its associated programs and committees, attest to the government’s confidence in a sustainable aquaculture industry in PEI.

2. Authority

Several acts, regulations, policies (including this policy) and federal/provincial agreements govern aquaculture activities in PEI, including:

• Agreement for Commercial Aquaculture Development between the Government of Canada and the Government of Prince Edward Island
• Aquaculture Activity Regulations
• Bank Act
• Canada Business Corporations Act
• Canadian Environmental Protection Act, 1999
• Canadian Navigable Waters Act
• Canada Shipping Act, 2001
• Fisheries  Act
• Fisheries (General) Regulations
• Gulf Region Molluscan Spat Collection Operational Policy
• Management of Contaminated Fishery Regulations
• Migratory Birds Convention Act, 1994
• Private Buoy Regulations
• Prince Edward Island Companies Act
• Prince Edward Island Corporations Act
• Prince Edward Island Fisheries Act
• Prince Edward Island Partnership Act
• PEI Aquaculture Environmental Code of Practice
• Safe Food for Canadians Regulations
• Species at Risk Act

Other acts, regulations, policies and/or agreements may govern aquaculture leasing.

3. Definitions

“Aquaculture” - The cultivation of fish.

“Bottom Lease” (BOT) - A lease issued for cultivating aquatic species, as described in the lease contract, on the seabed.

“Boundary Amendment of an Aquaculture Lease” -  A change in the boundaries of an aquaculture site in such a way that the new footprint shares common area with the existing aquaculture site.  No net gain in acreage can be accrued.

“Federally Licensed Processor” - Seafood processors licensed under the Safe Food for Canadians Regulations.

“Holding Site” (HOL) - A lease approved exclusively for the purpose of holding shellfish on a short term basis, prior to processing or shipping, by processors that are licensed under the Safe Food for Canadians Regulations.

“Lease”- A legal contract between a leaseholder(s) and DFO, which grants exclusive rights to the area described in the lease contract, in accordance with the conditions of the lease contract, for the purpose of the cultivation of the species described in the lease contract.

“Leaseholder” - An individual or legal entity that has signed a contract with DFO entitling them to perform aquaculture in a defined area, as per their lease contract.

“Moving an Aquaculture Lease” - A process whereby an aquaculture site is moved to a location that does not share common area with the existing aquaculture site. No net gain in acreage can be accrued.

“Recognized Financial Institution” - A Canadian financial institution as defined in the Bank Act, including: the Business Development Bank of Canada, Export Development Canada and Provincial Load Boards (e.g. P.E.I. lending agency).

“Molluscan Spat Collection Licence” (Spat Licence) - A licence for the collection of spat. Spat collection is considered to be a fishery under the Fisheries Act and the Gulf Region Molluscan Spat Collection Operational Policy.

“Water Column Lease” - A bottom lease where the leaseholder has permission to use the water column to cultivate an aquatic species, as described in the lease contract. Water column leases can have 1 of 2 designations:

• Off Bottom (OB): If the lease was originally issued for oyster culture
• Surface (SUR): If the lease was originally issued for mussel culture

4. Abbreviations

BOT

Bottom (lease)

DFO

Fisheries and Oceans Canada

CSSP

Canadian Shellfish Sanitation Program

DGPS

Differential Global Positioning System

ECCC

Environment and Climate Change Canada

HOL

Holding (site)

MoU

Memorandum of Understanding

OB

Off-Bottom (lease)

PEI

Prince Edward Island

PEISAMAC

Prince Edward Island Shellfish Aquaculture Management Advisory Committee

PEIAZS

Prince Edward Island Aquaculture Zoning System

PEISALRC

Prince Edward Island Shellfish Aquaculture Leasing Referral Committee

PEISALAP

Prince Edward Island Shellfish Aquaculture Leasing Appeals Panel

SUR

Surface (lease)

5. Species cultured

The Policy governs the culture of the following species, as listed in the MoU:

• American oyster – Crassostrea virginica
• Blue mussel – Mytilus edulis
• Bay quahaug – Mercenaria mercenaria
• Sea scallop – Placopecten megallanicus
• Bay Scallop – Agropecten irradians
• Bar clam – Spisula solidissima
• Soft shell clam – Mya arenaria

6. Applicant eligibility

Applicants and leaseholders must be 1 of the following:

• a Canadian citizen or permanent resident, 18 years of age or older
• a legal entity, as perapplicable provincial legislation and/or the Canada Business Corporations Act
• an Aboriginal organization
• organizations that use aquaculture as part of their production cycle for shellfish fisheries development

 In addition:

• a maximum of 1 leaseholder, may be named on an aquaculture lease
• existing Leaseholders will have until the renewal at the 5 year anniversary of their lease to be compliant with the eligibility standards described in this section

7. Lease types

Bottom (BOT) culture lease

A BOT aquaculture lease allows the leaseholder to conduct aquaculture on the seabed.

• minimum size of a BOT lease issued after the effective date of this policy is 1 acre
• maximum size of a BOT lease issued after the effective date of this policy is 5 acres

Off-Bottom (OB) lease

An OB aquaculture lease allows the leaseholder to conduct aquaculture in the water column. Authorization issued under the Canadian Navigable Waters Act by Transport Canada is necessary for the approval of an OB lease.

• minimum size of a OB lease issued after the effective date of this policy is 1 acre
• maximum size of a OB lease issued after the effective date of this policy is 100 acres

Surface (SUR) lease

An SUR aquaculture lease designation was originally used to differentiate mussel culture lease from an oyster culture lease. It allows the leaseholder to conduct aquaculture in the water column. Authorization issued under the Canadian Navigable Waters Actby Transport Canada is necessary for the approval of an SUR lease.

• minimum size of an SUR lease issued after the effective date of this policy is 1 acre
• maximum size of an SUR lease issued after the effective date of this policy is 100 acres

Note: Minimum and maximum lease sizes only apply to applications approved after the effective date of the Policy. 

8. PEI Aquaculture Zoning System

The Prince Edward Island Aquaculture Zoning System (PEIAZS) considers regulatory and policy restrictions to help define areas where shellfish aquaculture may or may not occur. A description of the system itself, it’s development and changing needs can be found in Annex B.  

9. Applications for new aquaculture sites

• the applicant must submit a complete application and payment to DFO
• all applications are reviewed by the PEI Shellfish Aquaculture Leasing Referral Committee (PEISALRC)
• applications are assessed according to the Site Assessment Criteria for Lease Applications (Annex A)
• applications are subject to consultation with First Nation groups and/or other Provincial or Federal bodies
• an application will not be processed if the applicant has:
  • outstanding fees payable to DFO
  • violations of the terms and conditions of an existing lease contract
  • violations of the Fisheries Act or governing regulations
• applications will only be accepted for areas identified as eligible for aquaculture development under the PEIAZS

10. Spat collection licence applications

• the applicant must submit a complete application package, including a site development plan and payment to DFO
• applications are assessed as per the Gulf Region Molluscan Spat Collection Operational Policy

11. Holding sites

Holding (HOL) sites allow federally licensed processors to hold product destined for the marketplace. If the HOL site uses the water column, authorization issued under the Canadian Navigable Waters Act by Transport Canada is necessary for approval. HOL sites are not required to be in zones identified for aquaculture use.

• only species identified in section 5 of this policy are permitted to be on holding sites
• holding sites will only be issued to federally licensed processors. The applicant must submit a complete application package, including a site development plan and payment to DFO
• applications are subject to consultation with First Nation groups and/or other Provincial or Federal bodies.
• growing activities are prohibited on holding sites
• holding sites will be granted for a 1 year term. Sites in compliance with the terms of the effective contract are eligible for additional 1 year renewals
• holding sites will be a maximum 2 acres in size
• applications will be considered on a case-by-case basis. Applicants must clearly demonstrate why their existing operations do not allow for the proposed holding activities
• federally licensed processors that have been approved for a HOL site may apply for additional HOL sites. Applicants must demonstrate that their approved HOL site(s) is/are operating at, or greater than, 75% of full capacity

Applications for HOL sites will be assessed using the following criteria:

• water depth
• CSSP harvest area classification of approved
• recreational activity in the area (e.g. boating, fishing, etc.)
• commercial fishing activity in the area
• consultation with First Nations

12. Lease transactions

Lease transaction applications, including for: lease transfers, mortgage assignments, addition of an approved species, lease boundary amendments, classification conversions and applications for issuance of a lease(s) to a company or corporation are subject to the following requirements:

• applicant eligibility is determined by section 6 of this policy
• the applicant must submit a complete application package, including a site development plan and payment, to DFO
• the applicant may only apply to cultivate approved species identified in section 5 of this policy
• applications are subject to consultation with First Nation groups and/or other Provincial or Federal bodies
• applications will not be processed if the applicant is not in compliance with the terms of their lease contract, or if there are outstanding liens or mortgages against the lease

Lease transfers

A lease transfer is the process whereby a leaseholder transfers all the rights or benefits under a lease to another. The original leaseholder is released of all their obligations under the lease contract.  

• a lease is not eligible to be transferred within the first 24 months of the effective contract date
• a leaseholder may request to have their lease split to transfer a portion of the site to another. All sections in this policy apply to the resulting leases, including minimum size (Section 7)
• a leaseholder may not transfer a lease that is mortgaged without written authorization from the lending institution 

Mortgage to a recognized financial institution

A mortgage to a recognized financial institution is the process whereby all the rights or benefits under a lease are assigned to a recognized financial institution. The leaseholder maintains all their obligations under the lease.

• the assignment of a lease to a recognized financial institution must be approved by DFO
• the terms and conditions of the lease contract remain in effect
• only 1 mortgage assignment per lease is permitted
• a letter to DFO from the lending institution is required to remove a mortgage assignment

Addition of an approved species

Addition of an approved species is the process whereby additional species are approved for cultivation on a lease. The applicant must submit a modified site development plan.

• applications may be reviewed by the Chair of the PEI Introductions and Transfers Committee

Boundary amendment of an aquaculture site

A lease boundary amendment is a process to change the boundaries of an aquaculture site in such a way that the new footprint shares common area with the existing aquaculture site. Boundary amendment requests require an amended site development plan and a site assessment of the new area subject to the criteria outlined in Annex A of this policy.

• approved boundary amendment requests will result in no net gain in acreage
• support for an OB or SUR lease boundary amendment does not imply approval under the Canadian Navigable Waters Act. Transport Canada’s review and approval of the application is required before the application can be approved by DFO

Moving an aquaculture lease

Moving an aquaculture lease is a process whereby an aquaculture site is moved to a location that does not share common area with the existing aquaculture site.

Moving an aquaculture lease requests require an amended site development plan and a site assessment of the new area and are subject to the criteria outlined in Annex A of this policy

• approved lease move requests will result in no net gain in acreage
• support for an OB or SUR lease move does not imply approval under the Canadian Navigable Waters Act. Transport Canada’s review and approval of the application is required before the application can be approved by DFO

Lease Relocation – Special Circumstances

The purpose of this policy is to clearly outline circumstances when leaseholders can apply to relocate a lease to address a significant change to their existing aquaculture lease that results in it no longer appropriate for the continued culture of shellfish and the rules under which they can be relocated.

From time to time, circumstances may develop that result in a lease no longer being usable for the continued culture of shellfish. Only impacts from unanticipated and/or natural phenomena that is beyond control of the leaseholder will be considered.

To be eligible to apply to relocate a lease under this policy, the leaseholder must:

• Provide proof of lease usage. This can be done by the historical submission of Annual Lease Reports, receipts, invoices or other types of proof of sale for the harvest of shellfish from the impacted lease.
• Provide proof of the impact to the lease. (e.g. decrease water depths, dates of classification changes)
• Submit an application to the Aquaculture Leasing Division to move a lease, clearly stating the type of impact, the source of the impact, the timeframe over which the impact has occurred and a quantification of the impact on their business.

All elements of the PEI Shellfish Aquaculture Leasing Policy will apply, including minimum and maximum leases size regardless of original lease size, application review process etc.

Locations in the same area (PEI Shellfish Aquaculture Leasing Zone) of the original lease must be considered first. If the leaseholder has leases in different estuaries, the second priority will be to add on to an existing lease in another area. The third priority will be to apply for a footprint in another zone.

No increase in acreage will result from the relocation but a potential smaller footprint may be allocated.

Conversion of culture method

Conversion of culture method is the process whereby the approved culture method is modified.

• leases may be converted from a BOT lease to an OB lease, or vice-versa
• BOT leases are only eligible for a conversion if approved prior to July 12, 2006
• leases must remain on the same footprint after a conversion; however, applications for lease moves or boundary amendments will be accepted simultaneously   

Application for issuance of a lease(s) to a company or corporation

A leaseholder may request that their lease(s) be issued to their company or corporation.

Applicants are required to submit the following to have a lease(s) issued or transferred to a company or corporation that has not previously held an aquaculture lease on PEI:

• letters of incorporation or letters patent
• director’s register
• shareholder’s register
• a completed and signed “Application for issuance of a lease(s) to a company or corporation” form

Failure to provide requested documents

If a request is made by DFO for additional information or documents after the receipt of an application for any transaction described in Sections 9 - 12, and the request is not responded to within 60 days, the application will be closed and the client informed. The application fee will not be refunded.

13. Death of a leaseholder

• upon the death of a leaseholder of an aquaculture site, all interests in the lease become the responsibility of the deceased’s estate
• the estate assumes responsibility for maintaining compliance with the terms of the lease contract and with this policy, including but not limited to payment of lease fees, marking the lease and returning annual lease reports
• the estate has 5 years from the date of the leaseholder’s death to submit an application to transfer the lease to an eligible entity as described in Section 6
• proof of the appointed executor or administrator of the estate must be provided to DFO
• the application must be made by the legally appointed executor or administrator of the deceased’s estate
• leases held by an estate and not transferred within the five (5) year period will be cancelled

14. Corporations in receivership

Where DFO has been informed that a corporation holding a lease is in receivership, the leases will remain valid but will not be amended. All interests in the lease become the responsibility of the receiver.

The receiver assumes responsibility for maintaining compliance with the terms of the lease contract and with this policy, including but not limited to payment of lease fees, marking the lease and returning annual lease reports. The receiver may request that the lease be transferred to an eligible applicant, as outlined in Section 6.

If a lease held by a corporation in receivership reaches a 5 year renewal anniversary, and the officers of the corporation do not notify DFO that the corporation is continued, DFO will either cancel the existing lease or transfer it to an eligible applicant.

15. Fee structure

There are a number of leasing fees associated with acquiring permission to operate and maintain an aquaculture lease. PEISAMAC will review the business plan of the PEI Aquaculture Leasing Division annually and advise Fisheries and Oceans Canada on fees. The PEI Aquaculture Leasing Program desires to provide the most cost-effective services possible. The fiscal year for the Aquaculture Leasing Program is April 1 to March 31 and all fees are based on that period. The fees for the current fiscal year are attached in Annex C.

Lease transactions and/or services

Fees will be applied to lease transaction and/or services as determined with the PEI Aquaculture Leasing Management Board. The following describes the services for which a fee applies:

• New Application - Fee for the submission of an application for an aquaculture lease or a spat licence
• Lease Transfer - Fee for submission of a request to transfer an aquaculture lease
• Mortgage Assignment - Fee for submission of a request to mortgage an aquaculture lease to a lending institution
• Resolution of an Estate - Fee for submission of a request to resolve aquaculture lease(s) in an estate. One flat fee is charged regardless of the number of leases or how they are being resolved
• Appeal Fee - Fee to appeal all decisions on an individual’s lease or application by the PEI Aquaculture Leasing Division or the PEI Area Director, Fisheries and Oceans Canada
• Formation of a Company - Fee for submission of a request to register aquaculture leases in a company name
• Add or Delete a Species - Fee for submission of a request to add or delete a species to an aquaculture lease contract
• Boundary Amendment of a Lease - Fee for submission of a request to amend the boundary of an aquaculture lease
• Moving a lease - Fee for submission of a request to move an existing lease to a new footprint
• Re-instatement - Fee for the re-instatement of lease following its cancellation

The PEI Aquaculture Leasing Division, in consultation with the PEISAMAC, may determine other fees as required.

Annual lease fees:

• all annual lease fees must be paid through the National Online Licensing System (NOLS)
• leaseholders will be notified by email that fees are available to pay through NOLS
• annual lease fees are for the time period of April 1 to March 31 the following year. They will be available to pay through NOLS in April, and must be paid by December 31st of the billing year
• if fees are not paid in full by January 30 of the following calendar year, a registered letter shall be sent to the lessee informing that the lease is cancelled. Notification of the lease cancellation will also be sent to any person or institution holding a lien on the leased area (for more information see Section 19, Cancellation of an Aquaculture Lease)
• if a lease is cancelled for non-payment of fees and extenuating circumstances exist, a lessee may request an exception to the policy by submitting a request in writing to the PEI Aquaculture Leasing Division. The DFO PEI Area Director will review the request and render a decision in writing
• once the lease has been cancelled, the lessee may appeal the decision (for further information see Section 20 - Appeals)

16. Aquaculture site marking

Bottom leases

• leases approved for bottom culture only must be marked according to the requirements outlined in the lease agreement
• buoy types must meet requirement of the Private Buoy Regulations
• the buoys must remain in the said position at all times to be easily viewed from May 1 to November 30 inclusive (or longer if desired by the leaseholder), ice conditions permitting

Water column leases

• sites utilizing the water column (OB and SUR) must be marked in accordance with the marking requirements issued under the Canadian Navigable Waters Act authorization

17. Canadian Shellfish Sanitation Program

• applications for new aquaculture sites will only be accepted in areas classified as approved or conditionally approved under the CSSP
• leases in areas classified as restricted or conditionally restricted will be managed as per the Management of Contaminated Fisheries Regulations and the CSSP Manual of Operations
• harvest of shellfish from a lease located in a restricted or conditionally restricted area will require a licence under the Management of Contaminated Fisheries Regulations
• if the water quality classification, as defined under CSSP, of a lease site has changed from approved, the lease may be renewed, provided the classification is not prohibited. The leaseholder must adhere to the Management of Contaminated Fishery Regulations for shellfish harvest in contaminated waters 

18. Development and ongoing operations of lease

Terms and renewal

• DFO may renew the lease agreement up to 4 times, for 5 years each time after the initial 5 year term, to a maximum of 25 years from the date on which the lease contract came into force. At the end of the final 25 year term, DFO may approve additional 5 year terms under such terms and conditions as it determines
• if a lease will not be renewed at the end of a term, the leaseholder will be notified in writing and given reasonable notice of termination

Annual operating reports and other documents

• the holder of an aquaculture lease must submit an annual lease report (ALR) by April 1, for the preceding year. Forms are provided by DFO. Annual reports may be subject to random audits
• at the request of DFO, the leaseholder must be prepared to provide books, records, accounts, and other documents in such detail and form as required by the lease contract

Failure to supply the annual report, to provide information upon request to DFO, or to develop the lease as per the site development plan may result in the cancellation of the aquaculture lease.

Lease utilization

Fisheries and Oceans Canada is committed to the environmental and economic sustainable development of the shellfish aquaculture sector on PEI. As such, it is a priority of the Department to ensure each lease is being utilized to the extent possible. Lease compliance and lease utilization are reviewed upon the anniversary of the 5 year lease renewal. Utilization of a lease can be determined through site visits, annual lease reports, etc. Leases deemed to be underutilized or not following the approved site development plan, may be cancelled or the leaseholder may be asked to submit a revised site development plan. 

Lease utilization includes the requirement that any leaseholder who has obtained an aquaculture lease and received the relevant authorizations must begin operations, as per their approved site development plan, within the subsequent twelve months.

19. Cancellation of an aquaculture lease

The following situations may result in cancellation of a lease:

• non-compliance with the terms and conditions under which the aquaculture lease was issued
• where the review of the annual report and/or other documents requested by DFO, shows that the leaseholder is not operating the site
• where the results of a lease audit conducted by DFO show that the leaseholder is not in compliance and/or is not operating the site and/or is not accurately reporting to DFO
• non-payment of lease fees
• violation of Federal or Provincial legislation, as it pertains to activities related to operating an aquaculture lease in the marine environment
• if the CSSP water quality classification of a lease changes to prohibited

Within a period of 30 days of receipt of letter of cancellation, the lessee may have the lease(s) reinstated. To have a lease reinstated, all outstanding fees plus a reinstatement fee of 10% of the annual lease fee, or $100 (whichever is greater), must be paid. Additional requirements such as an updated site plan may be required.

Upon cancellation of a lease, leaseholder must:

• restore aquaculture sites in a manner satisfactory to DFO. Leases not restored within the allotted time frame may be restored at the leaseholder’s expense
• make immediate payment of any outstanding fees related to the lease

A leaseholder may request to cancel a lease upon written request to DFO. There is no refund of any fees paid.

Once a lease has been cancelled, the leaseholder has no pre-emptive right to the site. If the leaseholder wishes to obtain the same site again, they must submit a new lease application and meet the policy requirements.

Appeals

20.1 Application for an Appeal

• Application for an appeal will be accepted only from clients who are appealing a decision by DFO that directly involves their application or lease.
• Reasons for appealing a decision must relate to an alleged incorrect application of the Prince Edward Island Shellfish Aquaculture Leasing Policy or the Gulf Region Molluscan Spat Collection Policy. Discussions on whether a policy is reasonable or appropriate should be addressed through the PEI shellfish aquaculture management advisory process.

20.2 Appeal Process

• Appeal applications must be filed, in writing, to DFO within 60 days from the date of the letter informing the applicant of the decision.
• Appeal applications must clearly state the decision being appealed, and the reason for the appeal, including all pertinent information.
• The following decisions are not eligible for appeal;
  • decisions where an application has been denied because it has been deemed to contravene Federal or Provincial legislation (e.g. Canadian Navigable Waters Act, Species at Risk Act, Migratory Birds Convention Act, etc.)
  • decisions where an application has been denied because it has been deemed to pose a hazard to navigation or the environment;
  • decisions where an application would conflict with First Nation rights based activity;
• After the appeal request has been received by DFO, the appellant will be notified whether they will be granted an appeal based on reasons provided under section 20.1. Appellants will also be notified in writing of the date, time and location of their appeal hearing.
• If an appellant has other documents or relevant information not previously provided, then the appellant should provide a copy of the information to DFO at least fifteen days before examination of the case/hearing.
• Copies of all the departmental information related to an appeal will be sent to the appellant prior to the hearing.
• An appellant has the right to appear in person and/or to be represented by another person.
• The PEI Shellfish Aquaculture Leasing Appeals Panel (SALAP) will normally invite a representative of the PEI Aquaculture Leasing Division to the hearing to explain the intent of the policy in question and/or to answer any questions related to the policy.
• SALAP will review the appeal request and provide a written recommendation to the DFO Regional Director General, Gulf Region, who confers with the PEI Deputy Minister responsible for Aquaculture to make a decision.
• The appellant will be notified in writing of the decision by the DFO Regional Director General, Gulf Region.
• The decision of the DFO Regional Director General, Gulf Region is final. There is no provision for second level appeals.
• An appellant may withdraw an appeal at any time by notifying DFO in writing.

21. Implementation and amendment of policy

DFO reserves the right to amend this policy at any time in order to meet the needs of the aquaculture industry on PEI and to remain consistent with regulatory changes. Amendments to this policy are recorded in Annex D. 

Annex A: Site assessment criteria for lease applications

The following are the standard criteria used by the PEI Aquaculture Leasing Referral Committee in the review of applications for aquaculture lease sites.

Navigation considerations

• location of any navigation channels (marked and commonly used)
• vessel types and quantity that frequent the area
• riparian rights of adjacent landowners. Landowners have a right to access “navigable” water (navigable water is defined as a minimum of 4 feet in Prince Edward Island). Leases that are approved to use gear or crop in the water column must include navigational corridors in the lease footprints to accommodate access to and from shore

Fishing activity

Information on all fisheries that occur in the area, such as but not limited to, an estimate of the number of fishers for each, gear type used, proximity of the activity to the area applied for.

Recreational

• including but not limited to angling, smelt, clam, quahaug

Commercial

• including but not limited to smelt, oyster, clam, quahaug, eel, silverside, gaspereaux, lobster, rock crab

Consideration of any potential conflicts between the fisheries and the proposed aquaculture activity and potential mitigation measures.

Other water users

Other water users in the estuary including:

• recreational users, including boating, swimmers and near shore water crafts (power boats, wind surfers, kayaks, etc.), water based businesses (tourism)
• the presence of existing moorings or floating docks
• shore access in shallow areas or highly developed upland areas

The impacts the proposed aquaculture activity may have on the other water users and potential mitigation.

The impacts other water users may have on the aquaculture operations.

Past performance

• history of the applicant/leaseholder in following through existing site development plan(s)
• violations under the Fisheries Act
• compliance and adherence with existing policies, marking schemes, and adherence to boundaries
• orderliness of site(s)
• completeness of Annual Lease Report
• outstanding lease fees

Water depths

Appropriate water depths for the proposed culture techniques.

Water quality

• classification under the CSSP – approved, conditional, closed or prohibited
• potential for classification change

History of the area

No lease applications will be accepted for areas where another application had been rejected within the previous 5 years.

Quantity of shellfish

• leases will not be issued where there is found to be greater than 0.1 market size animal per square foot (or 1 animal per square metre)
• likewise, applications with densities greater than 1 animal per square foot of animals over 1 inch (oyster) and ½ inch (clams, quahaug ) will not be supported
• applications containing shell beds or significant harvestable beds will require a buffer
• the grade of the product or the inability of the area to produce market size animals will be taken into account (i.e. significant substrate or environmental issues)
• oyster spat less than 1 inch and quahaug/clam spat less than ½ inch will not be a factor

Upland use

• adjacent land use. (e.g. Agriculture, housing/cottage developments, campgrounds, industrial or potential point source effluent sources/ sewage treatment systems/lift stations)
• the impacts the proposed aquaculture activity may have on upland users and mitigation measures
• the impacts upland users on the proposed aquaculture operations
• as a general guideline, the PEI Aquaculture Leasing Referral Committee does not recommend the siting of a lease closer than 100 feet to shore. In exceptional circumstances, such as soft-shell clam sites, where the culture activity is closer to the high water mark and oyster leases where there is no potential interference with adjacent landowners, this guideline can be varied

Carrying capacity

• based on scientific information as it becomes available

Environmental issues

• while the Aquaculture Activities Regulations acknowledge and permit environmental impacts from installing, operating and decommissioning an aquaculture lease, appropriate care and caution must be exercised to minimize impacts

Annex B: PEI Aquaculture Zoning System

The PEI Aquaculture Zoning System has been a key element in the management of the aquaculture industry in PEI since its inception in the late 1980’s. The shellfish aquaculture industry was growing rapidly and the pressure on inland waters was significant. In response, intended to address a number of issues and potential conflicts, an aquaculture zoning system was developed and adopted for use in the bays and rivers in PEI.

Originally named the PEI River Designation System, the Aquaculture Zoning System grew out of a concept developed by staff in Fisheries and Oceans Canada and reviewed by means of a steering committee formed of agencies that had jurisdiction or an interest in aquaculture. This steering committee was made up of representatives of Fisheries and Oceans Canada, Coast Guard, Public Works Canada, Environment Canada, Parks Canada, Prince Edward Island Department of Fisheries, Prince Edward Island Department of Environment and Tourism Prince Edward Island. The concept for the PEI Aquaculture Zoning System is based largely on elements used in a number of land use zoning systems and applied, in this case, to water use. The goal was to streamline the application process for aquaculture and to facilitate expansion of the industry in PEI while avoiding conflict with other users.

The PEIAZS considered several aspects of the marine environment, including but not limited to:

• recreational use
• commercial operations on the water (i.e. shipping, recreational enterprises)
• wildlife sanctuaries
• provincial and Federal parks
• commercial fisheries
• other related marine activities

Legal issues were also considered and include:

• landowner (riparian) rights
• the right to navigation
• environment legislation
• aboriginal rights

Maps with designated zones were developed illustrating where and how aquaculture operations could be located. Each Department was asked to consult with their respective client groups in order to review the proposed zoning designation. The result of this review process was the PEI Aquaculture Zoning System which was officially adopted in 1987 by the Department of Fisheries and Oceans. It has been utilized since then to guide decision making in the aquaculture lease application process, particularly with regard to shellfish (mussels and oysters) culture.

This zoning system recognized the validity of leases that were established prior to the implementation of the zoning system in 1986 and/or where amendments to the zoning system have been made.

Areas within the PEI Aquaculture Zoning System were designated using a system of letters paired to reflect the method of culture and availability (not suitability) of the water area represented. The first letter of the pair refers to bottom culture while the second letter refers to off-bottom/water column culture.

• “A” denotes an area that is considered acceptable for aquaculture activities. No obvious impediments have been identified in these areas.
• “B” denotes an area that is conditional. Applications in conditional areas require further review. Some potential conflicts and/or obstacles may have been identified in these areas. These could include: recreational users, a public fishery or possible interference with navigation.
• “C” denotes an area closed to new shellfish aquaculture leases. Applications for closed areas are subject to automatic denial based on obstacles such as: government wharves, dredge spoil sites, areas classified as restricted under the Canadian Shellfish Sanitation Program, provincial parks, public fishing grounds, federal lands, interference with navigation or heavy recreational usage.
• “Bo” is a designation used only in relation to off bottom culture for oysters; applicable only to bottom leases approved prior to July 12, 2006. “Bo” denotes an area that is closed to mussel culture, but conditional for off bottom oyster culture.

Areas are designated as follows:

• AA – acceptable for both bottom and water column culture
• AB – acceptable for bottom culture and conditional for off bottom culture
• AC – acceptable for bottom culture but not for water column
• BB – conditional for both bottom and off bottom culture
• BC – conditional for bottom culture and not acceptable for water column culture
• CC – not acceptable for either bottom or water column culture
• ABo – acceptable for bottom culture and conditional for off bottom oyster  culture
• CBo – not acceptable for bottom culture and conditional for off bottom oyster culture

In 2008, a review of the PEI Aquaculture Zoning System was undertaken to acknowledge off-bottom oyster technology that was not envisioned during the development of the zoning system. The situation in April 2008 requiring attention included leases that were not compliant with the zoning system and new applications on file for off-bottom oyster culture, most of which are for areas zoned “C” for off bottom culture.

A number of options were considered: do nothing; grandfather current leases; consider only applications in open zones; or review/revise the zoning system. All areas zoned AC, BC and CC where there was currently off bottom oyster leases, applications for conversion to off bottom leases or a potential for conversion applications were reviewed to determine if there are obvious impediments to off bottom oyster culture. Obvious impediments include for example; interference with navigation, recreational areas, public fishing grounds and provincial parks. This review resulted in the potential to rezone a number of areas where no obvious impediments were identified. On April 18, 2008 zones were established where there are no obvious impediments to off bottom oyster culture and that any consideration of applications for surface culture would be for oysters only.

In 2018, it was becoming apparent that the PEIAZS in its current state was not allowing for the proper management of the sector.  Its aquaculture zoning designations are geographically very broad and permissive; identifying very large areas as available for aquaculture development with little or no detailed explanation. This zoning system was the permissive internal plan for an industry in its earlier days of establishment and growth. Considering the suitability of any site is left initially to industry applicants, and then to the review system to evaluate. This was an appropriate approach in the experimental and growth phase of earlier days, but with industry maturity, it has become less helpful and inefficient. The original system did not substantially reduce the workload on the leasing authority, as that group was responsible to assess virtually all the characteristics of any site during the application process. Moreover, other users and the general public were not effectively reflected in the system. 

Why revise the zoning system?

• large number of applications received for BOT leases
• increased demand for OB oyster leases
• policies that have restricted industry’s ability to address lease issues (e.g. inappropriate depths on a surface lease and/or off-bottom lease for overwintering, holding area for processors)
• leasing Referral Committee having difficulty assessing (limited factors to assess approvals)
• public trust

A revised zoning system and application process represents the key point of interface between the aquaculture industry and all other users.  It will provide a greater opportunity for other users of the marine resource to have input into the process as well as an opportunity for industry to take a lead role in shaping the future of their industry. 

The revised PEIAZS (2022) considers several regulatory and policy restrictions, including but not limited to:

• CSSP growing area classifications
• migratory bird interactions
• considerations for species listed under the Species at Risk Act
• program policies such as, no lease within 100 feet of the high tide mark (exceptions for clam leases)

Annex C: Fees

Annex D: Record of PEI aquaculture leasing policy amendments