FAQs - Consultation on new refund requirements

Q1- Why is the CTA holding this consultation?

The COVID-19 pandemic – and the global collapse of air travel that resulted in mass flight cancellations – have highlighted a gap in Canada's air passenger protection framework.

The Canadian Transportation Agency (CTA) now has the authority, through a direction from the Minister of Transport, to make a new regulation to close that gap for future travel. On December 18, 2020, the Minister of Transport wrote to the CTA's Chair and CEO to indicate that he intends to issue a direction giving the CTA the authority to establish an obligation for airlines to provide a refund when there is a flight cancellation, or a lengthy delay, for reasons outside of the airline's control and the airline cannot complete the passenger's itinerary within a reasonable time.

The CTA is now seeking input from members of the public, consumer organizations, airlines and experts on the specifics of the new requirements, and will consider this feedback in developing the regulation.

Q2- Why don't the CTA's new Air Passenger Protection Regulations (APPR) already cover this issue?

The CTA develops regulation based on the legal authorities it is given. The APPR, which fully took effect on December 15, 2019, are based on the legislative framework set by Parliament in 2018. In comparison with passenger protection regimes around the world, the APPR cover a very wide range of passenger concerns, including cancellations, delays, bumping, lost and damaged baggage, tarmac delays, and the seating of families together.

However, the legislative framework did not allow the CTA to require refunds when flight disruptions happen for reasons outside the airline's control. For such situations, it only allowed the APPR to require the airline to complete the passenger's itinerary – that is, make sure the passenger gets to the destination on their ticket.

At the time, nobody foresaw a situation like the widespread flight cancellations and lengthy delays caused by the COVID-19 pandemic, where rebooking many passengers in a timely way just wasn't possible. Having now received the authority to establish new requirements for such situations, the CTA will develop a regulation obligating airlines to give passengers refunds in the case of a flight cancellation, and possibly a lengthy delay, that is outside the airline's control, if it is not possible for the airline to complete passengers' itineraries within a reasonable time.

Q3- What events are considered outside an airline's control?

The APPR include examples of events that can be considered outside of an airline's control. They include:

• Safety and security issues (including war, illegal acts, sabotage, government instructions);
• Medical emergencies;
• Weather conditions or natural disasters that make it impossible to safely operate the aircraft (for example, actual or forecasted blizzards, heavy winds, lightning, hurricanes);
• Instructions from air traffic control and airport operation issues; and
• Strikes or labour disruptions at an essential service provider (like an airport or an air navigation service provider).

The CTA may also determine whether an event not listed in the APPR falls outside of the airline's control.

In Determination No. A-2020-42, the CTA found that certain situations brought on by the COVID-19 pandemic -- such as flight disruptions to places covered by a government travel advisory, employee quarantine or self-isolation, and additional hygiene processes -- would be considered outside of the airline's control.

As part of its consultation, the CTA is seeking input on what pandemic-related situations should be considered within or outside of an airline's control.

Q4- What are the next steps and how long will this process take?

The CTA's consultation will close on March 1, 2021. All input received will be considered as the regulation is developed.

The regulation will require approval by CTA Members and the Governor in Council (effectively, Cabinet). Before being finalized, it will be posted for a public comment period in the Canada Gazette.

The CTA's goal is to have a final regulation in place by summer 2021.

Q5: When will the new requirements come into effect?

A final regulation must be in place before the requirements can come into effect. The CTA is moving quickly to have the final regulation in place – by summer 2021.

Until the new requirements are in place, airlines are encouraged to adopt policies that ensure no passenger is left out of pocket for the value of a cancelled flight, irrespective of the fare purchased or the reason for the cancellation.

Q6- How can I participate?

The CTA has developed a consultation paper, which provides more details and outlines elements of the new requirements to be developed. You can submit comments online by March 1, 2021.

If your input contains information you believe should be treated as confidential, you must give us two copies of it, as follows:

1. One copy (the public version) from which the confidential information has been blacked out.
2. One copy (the confidential version) in which:
   • each page is marked “contains confidential information” at the top; and
   • you highlight or otherwise identify on each page the confidential information that was blacked out in the first copy.

Only the public version will be posted on the CTA website. However, all documentation received is subject to the Access to Information Act and Privacy Act. The CTA will protect the confidentiality of information in accordance with these Acts, but they may require the release of information if someone requests it and it is not covered by the exemptions and exclusions in the legislation.

Q7- What can passengers do in the meantime if they are not satisfied with how an airline dealt with their flight cancellation?

Airline tariffs must set out all of an airline's terms and conditions of carriage, including terms and conditions of the airline's cancellation and refund policies. The requirements of the APPR also form part of an airline's tariff.

Passengers who believe an airline hasn't respected its obligations under the APPR or its tariff can submit a complaint to the CTA. The CTA offers informal dispute resolution services (facilitation and mediation). If a passenger's complaint cannot be resolved informally, the CTA can issue a binding decision through a court-like adjudication process, which involves the collection of evidence and arguments from both parties.