Proposed Air Passenger Rules Set for Take Off
Most important rights will be outlined by the Canadian Transportation Agency
OTTAWA, May 16, 2017 – The Public Interest Advocacy Centre (PIAC) today welcomed legislation announced today by the federal Minister of Transport, Marc Garneau, to strengthen Canada’s air passenger rights. The proposed legislative framework should provide a single standardized set of air passenger rules to Canadians. The proposed rules ensure passengers are entitled to certain rights in situations where a flying experience does not go as expected.
“The proposed rules should provide much needed consumer rights on air travel issues,” noted John Lawford, Executive Director and General Counsel of PIAC. “If passed, these changes will ensure airlines universally apply the same level of professionalism whether passengers experience difficulties on the ground or in the air.”
Transport Canada indicated the new initiative would establish clear standards of treatment for air travelers in common situations as well as financial compensation under certain circumstances. Examples include:
- Denied boarding (including in case of overbooking), delays and cancellations;
- Lost or damaged baggage;
- Tarmac delays over a certain period of time;
- Seating children near a parent or guardian at no extra charge; and
- Ensuring carriers develop clear standards for transporting musical instruments.
“PIAC is cautiously hopeful that the Canadian Transportation Agency will be able to respond to the expected volume of complaints that will be generated by the new consumer rights. However, if the CTA is given this work without a major re-organization of the agency and greater resources, there could be turbulence,” Lawford noted.
“At the moment, the bar of expectation for consumers dealing with airlines rests firmly on the ground,” notes Jonathan Bishop, PIAC’s Research Analyst. “This element of Bill C-49 is a golden opportunity for the Canadian Transportation Agency to address the needs of air passengers in an effective manner, added Bishop. “Handled correctly, Canadians could benefit from a world-leading air passenger complaint regime.” concluded Bishop.
In 2015, PIAC was asked by the Transportation Act Review Secretariat to provide an analysis of air carrier rules from the consumer perspective. PIAC released its report entitled, Consumer Protection for Airline Passengers, in August of 2015. In the report, PIAC looked at consumer protections from around the world and recommended two elements: An Airline Code and an ombudsman for airline complaints. PIAC believes that these two methods together would ensure consumers knew their rights and, if an issue were to fall outside of listed rights, an ombudsman could deal with those complaints.
For more information please contact:
John Lawford
Executive Director & General Counsel
Public Interest Advocacy Centre (PIAC)
T: (613) 562-4002 ×25
C: (613) 447-8125
lawford@piac.ca
Jonathan Bishop
Research and Parliamentary Analyst
Public Interest Advocacy Centre (PIAC)
T: (613) 562-4002 ×23
jbishop@piac.ca
Minister Sousa Needs to Legislate a Best Interest Standard to Put Investors Interest First. Now.
PIAC asks, Can We Afford More Naval-Gazing?
Enough is enough.
In 2017, Canadians should be confident the person being paid to provide them financial advice is legally obligated to act in their best interest. It should not matter what their title is or who employs them. Bottom line, if you are legally entitled and being paid to provide financial advice, the client should come first, and that obligation should be backed up by the law.
Guess what? That is not the reality in 2017. In fact, the latest news is that a number of securities regulators in Canada are backing away from discussions to introduce a regulatory best interest standard, expressing strong concerns about the benefits of introducing such a standard.[1] British Columbia and Québec securities regulators contend introducing a regulatory best interest standard could exacerbate a sense of misplaced trust and overreliance by clients on their registrants.
Yes, heaven forbid any investor trust the person they are paying to ensure a successful financial future for them and their families. If securities regulators were in charge of the roofing industry, I would be investing in bucket makers, because Canadian roofs would have more holes than a cheese grater.
“If securities regulators were in charge of the roofing industry, I would be investing in bucket makers…”
To their credit, Ontario Securities Commission and Financial and Consumer Services Commission in New Brunswick expressed their support for a regulatory best interest standard. However, one can argue this continued commitment is little more than an exercise in navel-gazing. Literally decades have passed since securities regulators began discussing the need for an enhanced best interest standard. Meanwhile, countless Canadians have continued to mistakenly believe their financial advisor is legally compelled to work in their best interest. After a period of time, virtues associated with leadership such as the collection of evidence and consideration of arguments slide into cowardice. Most Canadians would consider a decade long enough to for securities regulators to provide the leadership necessary to improve the regulatory underpinnings of the advisor-investor relationship.
It is time for a more deliberate approach.
Minister Sousa to the Rescue?
On March 31, 2017, the Ontario Minister of Finance, Charles Sousa, presented a speech where he outlined his intention to address a series of challenges facing the financial services industry. The issues the Government of Ontario intends to address include examining the feasibility of a statutory best interest duty in Ontario.
This issue was brought to the Minister’s attention by an Expert Committee to Consider Financial Advisory and Financial Planning Policy Alternatives, established under his authority in 2015. The Expert Committee, chaired by Malcom Heins, the former CEO of the Law Society of Upper Canada, held consultations in 2015 and 2016. This process resulted in a final report that was tabled with the Minister in November 2016.
PIAC indicated Ontario consumers would benefit from a limitation in the use of titles in the financial services industry as well as an enhanced standard of care. (Photo courtesy of Skitterphoto)
What Did PIAC Have to Say?
PIAC participated in each round of this consultation and participated in multiple public hearings held by the Expert Committee. PIAC’s initial submission stated the following:
“If the Expert Committee could articulate and propose an improved standard of care to better align the expectations of many Ontario consumers with the current “suitability” standard, PIAC feels this would be a positive outcome for consumers.”
This was the polite way of saying, “please fix this misconception.” However, given the continued “ragging of the puck” by provincial securities regulators on this issue, it is now apparent securities regulators need to be scolded and told how to ensure an investment professional is acting in your best interest by provincial legislators. A new source of leadership is needed.
Minister Sousa can, and should, be that initial source. Ontario is home to over 400,000 jobs in the financial services industry. Ontarians should be able to trust their financial advisor with their retirement savings and planning without any misconceptions. In fact, a 2013 survey of over 2,000 Ontario investors found 93 per cent of respondents support the introduction of a best interest duty.[2] If an improved standard of care is instituted in Ontario, other jurisdictions would hard pressed to allow the current “suitability” standard to continue.
PIAC encourages the people of Ontario to contact their M.P.P. to ensure Finance Minister Sousa follows through on needed reform for the financial advice industry. (Photo courtesy of Negative Space)
What Can I Do?
Do you want the person being paid to provide you financial advice to be legally obligated to act in your best interest? Do you want your provincial government to provide the leadership that your securities regulator is failing to deliver on this issue?
If so, contact your local member of your respective provincial Parliament, Legislature or Assembly.
If you are from Ontario, encourage your Member of Provincial Parliament (M.P.P.) to speak up for you and ensure Minister Sousa not only examines the feasibility of a statutory best interest duty, but displays the leadership necessary to propose and implement a best interest duty for the benefit of Ontario investors.
You can find your Ontario M.P.P. at the following link.
Jonathan Bishop has been a Research Analyst with the Public Interest Advocacy Centre (PIAC) since 2012. He is the co-author of PIAC’s 2013 study of the financial planning industry entitled, Purse Strings Attached: Towards a Financial Planning Regulatory Framework. He also was an active participant in the consultations of the Ontario Ministry of Finance Expert Committee to Consider Financial Advisory and Financial Planning Policy Alternatives. PIAC’s September 2015 submission to the Expert Committee can be found here.
[1] Canadian Securities Administrators, CSA Staff Notice 33-319: Status Report on CSA Consultation Paper 33-404 Proposals to Enhance the Obligations of Advisers, Dealers, and Representatives Toward Their Clients. May 11, 2017. Page 7. Online: http://www.osc.gov.on.ca/documents/en/Securities-Category3/csa_20170511_33-319_proposals-enhance-obligations-advisers.pdf.
[2] Investor Advisory Panel, “Strengthening Investor Protection in Ontario-Speaking with Ontarians,” Ontario Securities Commission, January 2013, page 27. Online: <http://www.osc.gov.on.ca/documents/en/Investors/iap_20130318_strengthening-investor-protection.pdf>.
Internet Freedom Commentary: Why the CRTC’s zero-rating decision was the right thing to do
(This article originally appeared on Cartt.ca on May 4, 2017)
MUCH INK ALREADY HAS been spilled over the CRTC’s decision to disallow Vidéotron’s “Unlimited Music” offer (and effectively most similar “differential pricing”) because it was unjustly discriminatory. More will be said, even opposite this column, by Canada’s biggest telcos.
Why the sturm und drang over a regulatory decision that effectively preserves the prior status quo? Quite simply, it is money. There is huge money to be made operating a network in a discriminatory manner. One can charge those not just at the receiving end but at the sending end. One can design pricing to match consumer and producer willingness to pay. One can achieve mutually beneficial advertising and other benefits between the service that is favoured and the network owner.
Money, money, money. And all on top of what you already earn from just running a network. Sweet.
Critics of the CRTC decision say that discriminatory pricing is simply rational economic behaviour on the part of the telco. Such pricing is allowed in other fields and indeed is a textbook example, in economics, of rational pricing. This is a logic so perfect, one Trump-transition leader says, that consumers are actually missing out on considerable economic benefits. As noted by the CRTC in answer to our complaint about Vidéotron, however, this is untrue.
Advantageous offers are consistently made instead to the well-heeled, or most desired demographic. There will never be an offer to low-volume, low-income consumers, who will indirectly subsidize the advantages of the few, the proud, the rich.
Yet what lets me take this seemingly socialist position? Why has the CRTC acted “irrationally” according to the critics? The answer is quite simply: it’s the law.
The Telecommunications Act, in black and white, says that there shall be no unjust discrimination nor undue preference allowed to the telcos: not in relation to any other competitor, nor between customers, nor even between those affected by their actions. There is an unbroken line of CRTC and court rulings upholding them from Challenge Communications to the Zero-Rating decision that all have said, “thou shalt not discriminate simply to make money”. In other words, not only does law trump economics, there is a special section of our telecommunications law that specifically says not to do what Vidéotron did. All the CRTC did, therefore, was uphold the law; in doing so, they simply wrote the latest chapter in the book of prohibiting unjust discrimination.
The law has been called an ass, and unclear, and unknowable, but here it is crystal clear. It has been so for over 700 years. The principle underlying our unjust discrimination law is “common carriage” and it is deliberately at odds with “pure” economics for several reasons. First, the law quickly understood that operation of an essential service, like cartage, or today telecommunications, is relied upon by all of the public and so should treat them all as equals. Why? Because the network function of the service is quickly undermined by “special deals” favouring certain customers. It leads network operators to choose inefficient transmission methods. It incents them to cover up slow service that is the consequence of making more resources available to the favoured customers. It makes them, eventually, not be of service to society at all, but only to themselves and thus to destroy their own essence.
Favouritism also means that the economic activity enabled by the network service is limited. Only those making a deal with the network operator get their product to market. Consumers only get a limited palette of choice and cannot use their demand to drive the market. It is here that the unjust discrimination principle intersects with more recent expressions of the concept coming from the engineering side, the so-called “net neutrality” arguments. Net neutrality emphasizes this loss of “edge innovation” and provides compelling arguments for rules very like common carriage non-discrimination. After all, would the telcos now let a new Netflix come online if they could nip it in the bud? You can bet they wouldn’t. And you can no longer Netflix and chill.
So until Canadian law is changed, all of this discussion of economics and telecom is misplaced. What is being proposed is against the law.
John Lawford is Executive Director and General Counsel of the Public Interest Advocacy Centre (PIAC).
Michael Janigan named a full-time member of the Ontario Energy Board
The Public Interest Advocacy Centre (PIAC) is very pleased to announce that Michael Janigan, former Executive Director and General Counsel of PIAC and most recently, Special Counsel, Regulatory and Consumer Affairs for PIAC, has been named as a full-time member of the Ontario Energy Board, effective April 26, 2017, for a fixed term of two years.
PIAC is grateful for the nearly 30 years that Mr. Janigan served this organization in leadership roles. We have no doubt that he will diligently serve the residents of Ontario in this new appointment from a strong public interest viewpoint. We wish him all the best and thank him for his unstinting dedication to PIAC.
Short Biography of Michael Janigan
Michael Janigan has been appointed as a full-time member of the Ontario Energy Board, for a fixed two year term, effective April 26, 2017.
Mr. Janigan was until recently the Special Counsel, Regulatory and Consumer Affairs of the Public Interest Advocacy Centre (PIAC) located in Ottawa, Canada. The Centre provides legal services and research on behalf of Canadian consumers and the organizations that represent them. The work of the Centre primarily involves issues concerned with the delivery of telecommunications, energy, broadcasting, banking, transportation and other important public services. The Centre has been in existence since 1976, and has a small staff of lawyers, researchers and administrative personnel located in Ottawa and Toronto.
Mr. Janigan was the Executive Director of PIAC from 1992 until September of 2012, when he assumed a role concentrating on energy regulation and general consumer protection. Prior to his engagement by the Centre, Mr. Janigan was a city and regional councillor representing a downtown ward in the City of Ottawa. He was elected to that position in the community where he carried on a busy litigation practice. Mr. Janigan was born in Ottawa, and attended the University of Western Ontario, in London, Ontario where he obtained both his undergraduate degree in science and his LLB degree. He has also completed an LLM in Competition Law at the University of London. He has been called to the Bar of the Law Society of Upper Canada and is also a member of the State Bar of California. Mr. Janigan was formerly “of counsel” to the Washington D.C. law firm, Scott Hempling and Associates, which provided legal advice to regulatory commissions across the United States. Mr. Janigan, also served as Board member of the Travel Industry Council of Ontario (TICO), a provincial regulatory agency, as an Ontario-government appointee for over 10 years. He was the first non-industry chair of TICO for five years.
Mr. Janigan has taught courses and seminars in consumer protection law and regulation at Carleton University and in the LLM program of Osgoode Hall. He is the author of publications in the telecommunications, energy and other consumer utility field. He has been a featured speaker at Canadian and international conferences on public utilities and a frequent guest on radio and television programs covering those issues.