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Public Interest News: December 2007 – September 2008

Air Canada Westjet: fees and surcharges

(PIAC — 19/09/08)—On Sept. 17 the Montreal Gazette reported: “Air France, Deutsche Lufthansa AG and Singapore Airlines have reduced their fuel surcharges this month. But U.S. and Canadian carriers, contending with lacklustre travel demand in the face of a weak U.S. economy, say they’re not planning to cut fees.”

“It seems to me that they’re rather quick to implement charges (on checking extra bags and pillows) and fuel surcharges when prices go up, so we’d expect to see the same type of reaction when prices are going down,” said Michael Janigan, executive director of the Ottawa-based Public Interest Advocacy Centre.

“Most observers would feel that fuel is trading down, so it’s reasonable to expect that consumers should benefit from that.” He questioned whether carriers are now using the fuel surcharges – initially described as an industry lifeline – to boost profits,” Gazette’s Allison Lampert reported.

The next day Air Canada eliminated its second bag fee and folded its fuel surcharges into advertised fares and Westjet eliminated its fuel surcharge.

Option Consommateurs opens Ottawa office

(PIAC — 19/09/08)—Option Consommateurs opened an Ottawa office staffed by Ms Anu Bose on Sept. 18. Ms Bose holds a doctorate in Development Administration from the University of Birmingham (U.K). She has worked in India, Kazakhstan, Sri Lanka, Switzerland and the UK and spent a major part of her career in the not-for-profit and academic sectors. She will also be responsible for representing consumers’ interests on Parliament Hill.

Option Consommateurs is a Montreal-based not-for-profit association whose mission is to promote and defend the rights and interests of consumers and ensure that they are respected. It was founded in 1983. Option Consommateurs is involved in over thirty class-action suits. It has developed a special expertise in energy, agrifoods, financial services and commercial practices.

Option Consommateurs and the Public Interest Advocacy Centre work together on many projects including Public Interest News.

Bell Expressvu late fee: criminal

(PIAC — 19/09/08)—”The Ontario Superior Court of Justice sided with a class-action suit that claimed a $25 “administrative” fee charged to Bell ExpressVu customers who were more than two months late paying their bills amounted to a criminal rate of interest. The law in question prohibits annual interest rates in excess of 60 per cent and was originally intended to target loan sharks,” the Toronto Star reported on Sept. 17.

“I think the reason why you still have this going on is that there’s next to zero customer protection in federally regulated industries such as airlines and telecom,” PIAC’s John Lawford said in the report by the Star’s Chris Sorensen.

In a Canwest News Service story: Lawford said he ” fully expects the company to appeal the decision, but its challenge will be hampered by (Justice) Perell’s record. “Perell can pretty much write any book on any area of law he wants. In particular, he’s often looked at debt, credit and payment issues, so if the Court of Appeal works the way it should, this should be an unappealable judgment.”

“Lawford said the principle is simple: “It just comes down to companies can’t use legal trickery to try to explain charges away when they have the effect of interest,” Canwest’s Sarah Schmidt reported Sept. 17.

PIAC has begun a study on late fees and criminal rates of interest.

Voting rules: Homeless and Native people out in the cold

(PIAC — 19/09/08)—”People planning to vote in this fall’s federal election who don’t have the ID required under new rules may just have to sit it out. In November 2007, the British Columbia Public Interest Advocacy Centre filed a legal challenge with the B.C. Supreme Court against an amendment to the Canada Elections Act regarding voter identification,” Georgia Straight reported on Sept. 16.

“However, hearings are not expected to take place before the October 14 federal election. A paper prepared by (BC PIAC’s Jim) Quail cited estimates by former chief electoral officer Jean-Pierre Kingsley that five percent of voters would encounter problems with the new rules, the equivalent of 700,000 Canadians being unable to cast their ballots.

“I was hoping the election wasn’t going to come,” Quail said. “It means we’re not going to have the problem fixed in time for this election and this is very unfortunate,” the Straight’s Carlito Pablo wrote.

Cell Phones: Early-termination fees

(PIAC — 16/09/08)—“Michael Janigan, executive director of the Ottawa-based Public Interest Advocacy Centre, says the early-termination fees are effectively used to lock consumers into a host of obligations that bind them to their current Provider,” CBC News reported.

“Bell and Telus embark upon a public relations fiasco associated with text messages with impunity,” he said. “Why do they do that? Well, because they get people locked into all of these contracts and things.” Janigan says competition would be improved if cellphone providers were limited to one-year contracts, noting long-distance telephone competition has been successful because consumers can change providers in a frictionless swap,” the CBC’s Peter Nowak reported on Sept. 8.

Phone costs and service: No consumer voice in Cabinet

(PIAC — 16/09/08)—“Why has all this negative sentiment toward telecommuns companies come to a frothing boil over the past year? Consumer groups say it’s the result of a push by successive governments for deregulation. “Deregulation is giving carriers even more chutzpah than they normally have,” says the Public Interest Advocacy Centre’s John Lawford. “This is what you get. It’s the chickens coming home to roost,” CBC News reported.

“The Liberals started the ball rolling in 1995 when then Prime Minister Jean Chrétien abolished the cabinet position of Minister of Consumer and Corporate Affairs. The position’s duties were folded into the new position of Industry Minister. The Conservatives followed up by issuing a policy directive to the CRTC shortly after taking office in 2006 that effectively declawed the regulator. Then minister of industry Maxime Bernier told the CRTC to avoid regulating proactively.

“The Competition Bureau, meanwhile, has been loud and clear that it is against intervening in the market. “I believe that regulation should always be viewed, not as a first step, but as a last resort,” Competition Commissioner Sheridan Scott, a former Bell Canada executive, told the annual Telecom Summit in June.

The result today is that there is no consumer voice on a national level, Lawford says, which stands in stark contrast to the United States, where the Federal Trade Commission is a strong and well-respected rights protector. “There’s nobody at the cabinet table to say, ‘Just a minute, people are angry,’” he says. “Deregulation is all well and good but you have to make sure people don’t get trampled on the way,” CBC’s Peter Nowak reported on Sept. 8

Flyers’ bill of rights toothless: Consumers say

(PIAC — 16/09/08)—“Transport Minister Lawrence Cannon announced on (Sept. 5) a new airline passenger bill of rights, but said legislation or regulations aren’t necessary to ensure it’s enforced, because Canadian airlines are on board with the plan. If passengers are already on an aircraft when a delay longer than 90 minutes occurs, airlines have to let them disembark, according to the new Flight Rights Canada unveiled at the Ottawa airport. And if a flight is delayed more than four hours, airlines will have to give passengers a voucher for a free meal. Airlines also will be required to put customers up in hotels if a flight is postponed more than eight hours, and the delay is not weather-related,” Canwest News Service reported.

The bill of rights is silent on the question of airfare advertising, and does not include any minimum penalties if airlines don’t abide by the terms.

Michael Janigan, executive director of the Public Interest Advocacy Centre, says this latest initiative is full of holes. In addition to doing nothing to prevent misleading advertising, he said the passenger bill of rights doesn’t establish compensatory relief for being bumped because a flight is overbooked or cancelled, or for having to deal with lost baggage, as is the case in the U.S,” Canwest Sarah Schmidt reported on Sept. 6.

Former PIAC exec seeks seat in Canada’s 40th Parliament

(PIAC — 16/09/08)—“On the advice of the Prime Minister, the Governor General, by proclamation on Sept. 7, dissolved Parliament and gave instructions to issue writs of election. Oct. 14 has been set as the polling day and the writs of election are to be returned by Nov. 4. Elizabeth May is seeking election in the Central Nova riding. “Ms. May is a graduate of Dalhousie Law School and was admitted to the Bar in both Nova Scotia and Ontario. She has held the position of Associate General Counsel for the Public Interest Advocacy Centre, representing consumer, poverty and environment groups in her work,” Globe and Mail Update reported Sept. 9

Big Biz Brother is watching: students

(PIAC — 16/09/08)—“Bill C-61, if passed and enforced, will mean ludicrous penalties for those who download and upload copyrighted material. People caught downloading music or video other.incs face fines up to $500. Uploading to a peer-to-peer network could result in lawsuits of $20,000 per file,” the Muse reported.

“This is very scary territory for Canada to be entering. In a healthy democracy, the private sector would not be responsible for surveilling and policing the public, yet this appears to be how the new law will work. Obviously, critics have described the Bill as anti-consumerist and pro-industry, for this and many other reasons. In fact, an astounding number of consumer advocacy groups, from Online Rights Canada to the Public Interest Advocacy Centre have vehemently opposed the Bill,” the Memorial University of Newfoundland student paper reported on Sept. 2.

“And, if you need another reason to dislike it, C-61 won’t just limit the leisure activities of students; it might also impact us in the classroom. Under the new legislation students and educators may only make one copy of digital course materials, and borrowing a CD from the library and copying it could mean a $500 fine.

Deregulation: Local telephone bills no lower

(PIAC — 16/09/08)—In April 2007 the federal government deregulated the local telephone industry. The government “promised the move would boost local phone competition and lower prices, but there has been little evidence of that, consumer groups say. In fact, Rogers raised its phone prices earlier this year while Telus was rebuked by the CRTC in April for introducing a new long-distance access fee to customers using call-around services such as Yak,” CBC News reported on Sept. 8

PIAC report on high-interest lending

(PIAC — 4/09/08)—The Public Interest Advocacy Centre will soon release a new report: “Not Ready for Prime Time”. The report which had been scheduled for release today, sets out some key findings of PIAC’s year-long research in the field of high-interest lending which includes payday loans and subprime mortgages. The report used focus group results in Edmonton, Toronto, and Vancouver to derive information concerning pay-day loan and sub-prime mortgage users.

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