# Inspections, investigations and compliance verifications

Enforcement actions Resources

Summary of enforcement actions taken by the Agency

Notice to industry: Enforcement of the all-inclusive air price advertising regulations

Is your air carrier licensed?

The Agency favours a collaborative approach in ensuring air carriers and service providers voluntarily comply with the Canada Transportation Act, the Air Transportation Regulations and the Personnel Training for the Assistance of Persons with Disabilities Regulations.

However, when licensed companies don't fully meet their responsibilities, this places the public at risk, and leaves properly-run companies at a competitive disadvantage.

Agency enforcement officers conduct periodic inspections and targeted investigations to verify that regulations are being followed, and they may use their powers to impose monetary penalties until compliance is achieved.

The summary of enforcement actions taken by the Agency provides a snapshot of our enforcement activities.

## Carrier and facility inspections

Enforcement officers periodically visit airlines and air cargo companies to ensure they meet all the terms of their licences. The Agency issues these licences once the airline or air cargo company has obtained proper insurance, has a Canadian aviation document, and meets ownership requirements.

During the visit, an enforcement officer will:

• verify the flight records, tickets, invoices and other financial records
• ensure the aircraft are insured and authorized under licence by Transport Canada
• review its tariffs to ensure they comply with the licence and the law
• ensure that companies that are required to train employees to help persons with disabilities have the necessary training program in place.

Regularly, enforcement officers also visit airports and transportation terminals to ensure that employees have the training they need to serve persons with disabilities.

Enforcement officers can issue warnings and penalties. The penalties can reach $5,000 per offence for individuals and$25,000 for corporations.

## Targeted investigations

Enforcement officers will investigate an airline or air cargo company if they think it does not meet the terms and conditions of its licence, or if they suspect it operates without a licence.

Officers can act based on their own observation and knowledge, or when they receive information from the public, another transportation company or law enforcement officers.

## Verifying compliance with all-inclusive air price advertising regulations

Agency officers also regularly verify that any person or corporation that advertises air fares complies with all-inclusive air price advertising regulations.

If an advertiser contravenes the regulations, the officer will issue a formal warning outlining the deadline for complying. Any subsequent contravention will result in a notice of violation and associated penalties.

## Enforcement measures

When enforcement officers believe that a transportation company has contravened the law, they may issue a warning, levy a fine, refer the matter to the Agency for action or turn the matter over to the police for prosecution.

### Warnings

When someone has contravened the Canada Transportation Act or regulations for the first time, the enforcement officer will normally send a warning letter. The recipient can ask the Agency within 30 days to review the warning (see Review and appeal process).

### Penalties

An enforcement officer may issue a notice of violation if someone contravenes the same provision of the Canada Transportation Act or regulations for a second time within four years, or for a first violation if it is serious enough. The notice of violation describes the offence and requires that an administrative monetary penalty be paid within 30 days.

#### What is an administrative monetary penalty?

An administrative monetary penalty (AMP) is a form of civil penalty in which an administrative body or regulator fines an individual or corporate body for an unlawful activity typically defined through legislation or regulations.

The goal of these penalties is to promote voluntary compliance with legislation. Penalties levied are proportionate to the type, severity and frequency of the infraction.

These penalties are one of several ways the Agency can enforce the law; other options include formal reprimands, cease-and-desist orders, licence suspensions or cancellations, and prosecutions.

## Review and appeal process

A party may choose to appeal a formal warning or notice of violation within 30 days of its issuance.

In the case of a formal warning, if the review shows that the recipient did not commit the offence, the Agency won't take any further action. But if the review shows the recipient did commit the offence, the Agency will record that fact for use in further enforcement actions.

To appeal a notice of violation, a party must request a review hearing with the Transportation Appeal Tribunal of Canada.

The Tribunal will hear arguments from the party and the enforcement officer, then issue its ruling. The party can appeal the decision to the Tribunal and subsequently ask for judicial review of the appeal by the Federal Court of Canada.

#### Non-compliance with all-inclusive price advertising: review of warnings and requests for exemptions

Air advertisers that request their warning be reviewed or they be exempt from the rules should note that the review process may take up to 120 days.

If the Agency determines the warning to be justified or decides not to grant an exemption, a monetary penalty may be applied for each day of non-compliance starting from the compliance date on the original warning letter up until the day on which a notice of violation is issued or the exemption is refused, including the days during which the review process took place.

Additionally, given the nature of an exemption, a penalty may still be applied for this period even if the Agency grants the exemption.

It is therefore in the interest of an advertiser to comply with the rules as quickly as possible. For further details, see Notice to industry: Enforcement of the all-inclusive air price advertising regulations.

## Penalty amounts

The following penalty amounts are prescribed in the Canadian Transportation Agency Designated Provisions Regulations.

1st violation 2nd violation ($) 3rd violation ($) 4th and subsequent violations ($) warning 100 100 100 warning 250 500 1,000 warning 500 1,000 2,000 warning 1,000 2,500 5,000$1,000 2,500 5,000 5,000

Note: An individual in this table also means a sole proprietorship or partnership. In most cases, an employee is viewed as an agent of the employer. The employer is therefore liable for the misconduct of its employees and is the subject of any enforcement action.

1st violation 2nd violation ($) 3rd violation ($) 4th and subsequent violations ($) warning 500 500 500 warning 1,250 2,500 5,000 warning 2,500 5,000 10,000 warning 5,000 12,500 25,000$5,000 12,500 25,000 25,000
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