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Travellers’ Protection Initiative / Coalition pour la protection des voyageurs

Follow up letter to the Standing Committee on Transport and Communications Considering Bill C-11, an Act to amend the Canada Transportation Act and the Railway Safety Act

Letter for Printing [pdf file: 0.11mb]

Honourable Members of the Standing Committee on Transport:

On behalf of the Travellers’ Protection Initiative (TPI), I am writing to urge members
to reconsider the amendments that have been proposed by the Standing Senate
Committee on Transport, in respect of advertising of the full cost of airline travel.
The TPI presentation to the Standing Senate Committee focused largely on consumer
protection and specifically on the change that was made by the House Standing
Committee on Transportation. This change amended Sec. 27 of the Act that creates
S. 86. 1, of the Canada Transportation Act, which if approved, would require air
carriers to fully disclose the cost of airline travel, with the exception of Provincial
sales tax and the Federal GST.
The TPI has concerns that members of the Senate have been influenced by the
position of the air carriers in their recent presentation to the Standing Senate
Committee and we would like to reiterate the importance of the original proposed
amendment and what it means to Canadian consumers.

We understand that the rationale behind the amendment from the Senate was
concern from two major air carriers that only two provinces in Canada, Ontario and
Quebec, have specific provincial legislation that require travel agencies to fully
disclose the cost of air travel in their advertising. Further, it is the airlines’ position
that the absence of legislation in other provinces requiring total price disclosure will
be injurious to the airlines as it will allow travel agencies in other Canadian provinces
to advertise net prices which will be lower than the total price of air travel.
In this regard, British Columbia also has a specific Travel Industry Act and has the
ability under its consumer protection legislation to include price transparency
requirements by regulation under the deceptive practices prohibition. In Alberta,
Section 4 (s) of the Fair Trading Act states that giving less prominence to the total
price of goods or services than to the price of a part, or failure to give the total price,
are unfair practices. In Manitoba, Subsection 2(3)(r) of the Business Practices Act
states that it is an unfair business practice where the price of part of a consumer
transaction is given in an advertisement to not give reasonable prominence to the
total price.

With either specific or potentially prohibitive legislation in place in Canada’s most
populous provinces representing the overwhelming majority of travel agency
business, the concerns of Canada’s major airlines about potential “unfair”
competition is more ephemeral than real. Five of the largest provinces in Canada
require complete transparency in airline advertising in some form or other and these
five provinces cover a high proportion of the sales in this country. It is also arguable
that the federal legislation may have a broad enough ambit to govern any
advertisers of airline travel services in Canada. In any case, a firm stand on
deceptive advertising would likely put an end to non-disclosure by the small minority
of travel agents who may not be compelled to comply. Travel Agencies would have
nothing to gain by not disclosing those same costs of services being sold on behalf of
an air carrier.

The TPI also has great concern that the course of action urged by the airlines and
endorsed by the Senate, continues a pattern of potential misrepresentation for the
sole reason that “someone else might be doing it.” Is this really the standard we
want for our licensed carriers?

Finally, U.S. counterpart airlines are required to fully disclose the cost of travel
services, including all transportation taxes and fees, with the exception of the U.S.
federal tax, which is very similar to what was being proposed in the original
amendment to this Bill C-11. This levels the playing field for both sellers and
purchasers of these products.

In closing, we again urge Honourable Members to fully consider the implications of
the Senate proposals to make changes to what has been specifically addressed,
considered, and approved in deliberations in the House, which was responsive to
evidence of overwhelming consumer preference for total price disclosure. It is not in
keeping with the objectives of the Act to allow our air carriers to advertise in a way
that is far below the Canadian expectation of business and advertising ethics.

Respectfully submitted,

The Travellers’ Protection Initiative / La Coalition pour la protection des voyageurs

Michael Pepper,
President and CEO /
Président et Chef de la direction
Travel Industry Council of Ontario

Michael Janigan
Executive Director and General
Counsel / Directeur exécutif et
Avocat général, PIAC

Christiane Théberge

Michel Arnold
Option Consommateurs

Travellers’ Protection Initiative

The Travel Industry Council of Ontario (TICO) is a not-for-profit corporation
wholly-financed by Ontario-registered travel agents and wholesalers. It administers
the Ontario Travel Industry Act and the Ontario Travel Industry Compensation Fund.
The Ontario Travel Industry Compensation Fund is wholly-financed by the industry to
protect consumers who do not receive the travel services for which they paid due to
the insolvency or bankruptcy of an Ontario-registered travel agent or travel
wholesaler, or due to the cessation of an end supplier airline or cruise line. The Fund
only covers consumers who have booked through an Ontario-registered travel agent.
TICO may be contacted at (905) 624-6241 or 1-888-451-TICO or www.tico.on.ca,
email tico@tico.on.ca

The Public Interest Advocacy Centre (PIAC) is a national non-profit
organization working to advance the interests of individuals and groups who
are generally unrepresented, or under-represented, in issues of major public
concern. PIAC focuses primarily on consumer issues concerning
telecommunications, travel, energy, privacy, the information highway,
electronic commerce, financial services, broadcasting, and competition law.
PIAC undertakes legal and research services on behalf of consumers and seeks
to ensure that the public interest is served, and not neglected, by decisionmakers
in government and the private sector, when decisions are made about
consumer issues. PIAC may be contacted at (613) 562-4002 or www.piac.ca,
email piac@piac.ca

Option consommateurs is dedicated to defending and promoting the interests of
consumers, primarily those with low incomes. To that end, it is active in various
industry sectors through its credit counselling, legal, press, research and advocacy
divisions. The association team is made up of about twenty individuals working in a
variety of professions such as law, finance, journalism, and research. Option
consommateurs directly reaches up to 10,000 consumers annually, and conducts
more than 400 media interviews. In addition to sitting on numerous task forces and
taking part in various consultations, the association team publishes research reports,
memoranda, practical guides and news articles. Option consommateurs may be
contacted at (514) 598-7288, 1-888-412-1313 or www.option-consommateurs.org

The Association of Canadian Travel Agencies (ACTA) is a national trade
association representing the retail travel sector of Canada’s tourism industry. ACTA is
an industry-led, non profit, membership-based organization. Its members include
retail travel agencies and suppliers such as tour operators, travel wholesalers,
airlines, hotels, destination marketing organizations, cruise and rail lines, and
automobile rental companies. ACTA represents the interests of Canadian travellers
through approximately 2,600 members employing 18,000 travel professionals. ACTA
may be contacted at: (613) 237-3657 or www.acta.ca

The Canadian Association of Airline Passengers (CAAP) is a coalition of
consumer organizations formed in 1999 to respond to the pending restructuring of
the Canadian airline industry, and to advocate policy and regulatory requirements
which are fundamental to protect passengers’ rights. PIAC and Option
consommateurs are both founding members of CAAP. http://www.piac.ca/caap.htm.
Other members of CAAP who have lent their voice to the Travellers’ Protection
Initiative include:

Air Passenger Safety Group
Michael Murphy: fmmurphy@cadmus.ca
James Lyon; jtlyon@sympatico.ca

Rural Dignity of Canada
Cynthia Patterson:

Consumers Association of Canada
Annemarie Buchmann-Gerber:

Manitoba Society of Seniors
Byron Williams: bywil@legalaid.mb.ca

Transport 2000 Canada
Harry Gow: hwgow@uottawa.ca

Ontario Society of Senior Citizens’
Morris Jesion: ocsco@web.net

Consumers Council of Canada
Joan Huzar: joan.huzar@utoronto.ca

June 6, 2007

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