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Volkswagen's logo is seen on a TDI diesel engine of its EOS car in Zurich, Switzerland, September 22, 2015.ARND WIEGMANN/Reuters

Environment Canada has opened its own investigation into the scandal enveloping Volkswagen AG and testing of the company's diesel engines that was designed to fool regulators.

The scandal erupted after it was revealed that the software on Volkswagen cars equipped with diesel engines contained a "defeat device" that led to false test results.

"Canadian legislation and regulations prohibit vehicle manufacturers and imports from equipping a vehicle with a defeat device," Environment Canada said late Tuesday.

About 107,000 Volkswagen and Audi passenger cars from the 2009-2015 model years were sold with diesel engines, Volkswagen Canada Inc. said.

Companies that are found to have broken the Canadian Environmental Protection Act are subject to fines of $6-million for each offence.