Bill 5, Protect Ontario by Unleashing our Economy Act, 2025 receives royal assent: Impact on infrastructure delivery in Ontario

On June 5, the province of Ontario enacted Bill 5, Protect Ontario by Unleashing our Economy Act, 2025 into law. Bill 5 enacts, amends, and repeals several statutes that play a role in planning, approving, and delivering infrastructure projects in Ontario.

The province’s stated objective with Bill 5 is to protect Ontario’s economy from the impact of existing and threatened tariffs on Canadian goods by accelerating the delivery of critical mineral and energy projects across Ontario, together with the supporting infrastructure for such projects. Bill 5 amends or enacts 10 statutes, including the Mining Act, the Electricity Act, 1998, the Ontario Energy Board Act, 1998, and the Rebuilding Ontario Place Act, 2023. 

This update highlights the impacts on infrastructure projects of implementing a new Special Economic Zones Act, 2025, phasing out the Endangered Species Act, 2007 and implementing the Species Conservation Act, 2025, and amending the Ontario Heritage Act resulting from Bill 5’s coming into law.

Special Economic Zones Act, 2025

Schedule 9 of Bill 5 creates the Special Economic Zones Act, 2025 (SEZA). The SEZA grants the Lieutenant Governor expansive and undefined powers to make regulations designating areas of the province as special economic zones, and grants powers to the Minister of Economic Development, Job Creation and Trade to designate trusted proponents or designated projects to which the SEZA would apply. 

Once designated, the Lieutenant Governor may by regulation exempt trusted proponents or designated projects from requirements under any act within a designated special economic zone. The intention of the SEZA is to streamline regulatory requirements to accelerate the construction and delivery of certain projects.

The SEZA provides that the criteria and considerations to be used to determine what or who should be designated as a “special economic zone,” “trusted proponent,” or ‘“designated project” may be established by regulation. The province has indicated it aims to designate its first special economic zone and to promulgate the regulations under the SEZA by September 2025. We will continue to monitor development of the SEZA and will provide further updates as its regulations are established and the province begins to apply this new tool.

Endangered Species Act, 2007 and Species Conservation Act, 2025

Schedules 2 and 10 of Bill 5 together work to significantly alter the approval process for species-at-risk related approvals. Schedule 2 establishes several amendments to the Endangered Species Act, 2007 (ESA) to reduce the regulatory burden of the legislation, including by amending the purpose of the ESA, narrowing the definition of habitat, and altering how the Species at Risk in Ontario List is updated. These amendments will act as an interim step until the new Species Conservation Act, 2025 (SCA) set out in Schedule 10 of Bill 5 comes into force, which is expected to happen in early 2026.

The ESA’s new stated purpose to provide for the protection and conservation of species at risk while taking into account social and economic considerations, including the need for sustainable economic growth in Ontario, a purpose consistent with much of the other changes made by Bill 5. Bill 5 also includes the following changes:

• narrowing the definition of habitat to add more certainty as to what a habitat is for a given organism;
• rather than automatically listing all species classified by the Committee on the Status of Species at Risk in Ontario (COSSARO) as extirpated, endangered, threatened or of special concern, giving the Lieutenant Governor the authority to make the listing, taking into consideration COSSARO’s classification;
• removing the requirement for the province to prepare recovery strategies as well as management plans for species of special concern;
• providing the province with additional compliance and enforcement powers to enter and inspect land, but removing the ability of a provincial officer to issue a “stop order” (replacing this power instead with an ability for the Minister of the Environment to issue a “mitigation order”); and
• removing the ability for proponents to pay a species conservation charge to the Species at Risk Conservation Trust rather than conducting mitigation activities.

When it comes into force, the new SCA is intended to accelerate projects by streamlining the registration process, setting up-front requirements, clarifying and narrowing developer obligations, and reducing duplication with federal approvals. 

In addition to carrying forward the above-noted amendments to the ESA, the SCA will implement a new registration-first approach for projects, where projects may proceed upon registration online as opposed to upon obtaining a permit. The proponent’s registration would be conditional on complying with requirements to protect species, which would be set out in regulations being prepared by the province in consultation with the public and Indigenous communities. 

This permit-by-rule approach is frequently used in Ontario, for instance with Ontario’s municipal class environmental assessment regime. This inversion of the current process may result in more certainty for projects and proponents while reducing delays that may result from the traditional permitting process.

Ontario Heritage Act

Schedule 7 establishes several amendments to the Ontario Heritage Act (OHA), updating enforcement and compliance rules regarding artifacts and archaeological sites. Significantly, the amendments also now permit the Lieutenant Governor to exempt properties from requiring an archaeological assessment under certain conditions.

The amendments expand the powers of the Minister of Citizenship and Multiculturalism to:

• assess whether any artifacts or archaeological sites are located on any land, or land under water, in the province;
• make assessment orders to direct that no persons shall alter or remove an artifact or any other physical evidence of past human use or activity until an archaeological assessment has been conducted and it has been reported that no further cultural heritage value or interest remains on the site;
• authorize the Minister of Citizenship and Multiculturalism to direct that seized artifacts be deposited in an archaeological collection, and be deposited with an Indigenous community in addition to a public institution; and
• appoint investigators and authorize investigators to enter premises (but not dwellings) during business hours, and to seize artifacts or other archaeological material during an inspection or investigation.

Importantly, the Lieutenant Governor is now permitted to, subject to conditions, exempt a property from requiring an archaeological assessment if the Lieutenant Governor believes the exemption could advance specified provincial priorities such as transit, housing, health, and long-term care. Projects in these fields may therefore benefit from fewer delays due to archaeological assessments, though developers should remain alert to the risk an assessment order may be issued on their project sites.

Section 68.3 of the OHA is also expanded to specify that instruments such as regulations and orders made by the Lieutenant Governor do not entitle persons to compensation. Coupled with the potential for delays resulting from an assessment order, developers and contractors will want to ensure their construction agreements contain robust provisions outlining the relief and compensation consequences of assessment orders and investigations.