Standing Committee on Transport, Infrastructure and Communities - January 12, 2023

Thank you very much, Mr. Chair.

I would like to thank the committee for the invitation to appear today.

As you noted, I am accompanied today by Tom Oommen, director general for analysis and outreach at the agency.

The agency has a broad economic regulation and dispute resolution mandate. On the one hand, this mandate relates to transportation by air, rail, marine and interprovincial bus, all of which fall under federal jurisdiction. On the other hand, it seeks to protect the rights of persons living with disabilities to an accessible transportation system.

The agency carries out its responsibilities in two specific roles. First, it acts as an economic regulator, responsible for developing regulations under the relevant legislation and implementing them. In addition, it issues licences, makes decisions and enforces regulations.

Second, the agency is also an administrative tribunal, resolving complaints through both informal and formal processes. A central part of its mandate is to provide air passengers with a consumer protection regime.

With the coming into force of the Air Passenger Protection Regulations in 2019, the agency established, for the first time, minimum consumer protection requirements that all airlines had to follow. Many of these requirements are designed to attenuate the impact of disruptions in air passengers' travel journey, and that is at their core.

The regulations impose requirements regarding three categories of flight disruption, with different passenger entitlements depending on the category of flight disruption: flight disruptions could be categorized as being within airline control, within airline control but required for safety, or outside airline control. Since the regulations came into force, many passengers have used them to enforce the airlines' new obligations.

I would like to remind everyone that the regulations came into force just before the pandemic. The pandemic, as you know, had a significant impact on the transport industry, which indeed had difficulty resuming normal operations. This resulted in a record number of complaints to the agency. To put this in perspective, here is some background.

In the year before the regulations came into force, in 2018‑19, the agency received about 7600 complaints. In the year that the APPR came into force, in 2019‑20, we received just over 19,000 complaints. And finally, in the current year, 2022‑23, that is since April 2022, the agency has received almost 21,000 complaints, just in the first half of the year.

We have streamlined our processes and achieved new efficiencies. Unfortunately, the fact remains that we have a backlog of about 33,000 complaints.

I just want to add that our experience has been that about 97% of our complaints are resolved informally through our facilitation process, which takes an average of 20 business days to close once an agency facilitator begins the process.

With respect to the recent holiday flight disruptions, we expect that a significant number of complaints will be filed with the agency. These complaints are usually filed a month or so after the flight disruptions in question, as passengers must first make their claim directly with the airline, which has 30 days to respond.

These flight disruptions began with winter storms that first impacted flights out of western Canada, particularly Vancouver, and later on impacted Ontario- and Quebec-based flights.

We were very quickly on the ground. Enforcement officers were there, communicating with airlines, monitoring the situation and gathering the necessary information. They are currently investigating potential violations of regulatory requirements, and the work is ongoing.

As an example of other things we have done, over the same holiday period, agency staff communicated with Sunwing regarding its cancellation of all flights to and from Saskatchewan until February 3.

At that time, we were told that all passengers requesting compensation—if they were informed less than two weeks in advance of their cancelled flights—would get compensation as required under the APPR, or the air passenger protection regulations.

We will continue to monitor the response of airlines to the holiday flight disruptions. We will also respond to incoming complaints arising out of these flight disruptions.

In order to help passengers who have filed complaints with the agency, we have recently added a new application to our website, which we call the case status update. It allows every complainant to know where they stand in the queue and what the next steps are in resolving their dispute with the airline.

Furthermore, we have posted consumer-friendly guides that can be easily read and navigated on a smart phone, and have provided information on what passengers are entitled to and how to file a complaint. This is to make it easy to follow the process, particularly if they are at the airport when the event happens.

We're also working on addressing the complaint backlog by further increasing our complaints processing capacity through identifying and implementing procedural improvements and modernizing our processes. We hope to eventually be able to automate some parts of our processes.

Thank you, Mr. Chair. We'd be happy to respond to any questions.

Q. What has the CTA done to address the events that occurred in the air travel sector over the recent holiday season?

• The CTA's powers under the legislative scheme are remedial: the CTA takes action after disruptions occur, whether through complaint resolution or enforcement.
• To take the holiday flight disruptions as an example, if a passenger is unable to resolve a dispute with an airline about compensation or a refund, they can file a complaint with the CTA. It is through the CTA complaint dispute resolution process that an individual passenger can be provided with these and other remedies.
• In addition, the Agency also monitors compliance with and enforces the regulations. In the case of the holiday flight disruptions, the CTA contacted the airlines involved and dispatched enforcement officers to begin the process of gathering information about whether regulatory requirements were met, for example with respect to communications with passengers and tarmac delays.
  • To date, one formal investigation has already been launched, and information continues to be sought that may result in further investigations being launched.
  • Findings of violation and monetary penalties will be published on our website.

Q. What can be done about the airlines not answering the phone during flight disruptions? (or What are the communication obligations of airlines under the APPR?)

• Airlines are obliged to post at airports and on their website that passengers have entitlements under the APPR and that they have recourse to the CTA if they have not been provided with those entitlements.
• At the time of a flight disruption, airlines must provide information about the reason for the disruption, what passengers may be entitled to, and what recourses are available, including to the CTA.
• Airlines must also provide any new information about the disruption as soon as possible.
• During a flight delay, airlines must provide updates every 30 minutes until a new departure time is set or until the passenger is provided a new itinerary.
• The regulations do not specifically address the issue of being able to communicate with airlines over the phone.

Q. Why hasn't the CTA issued monetary penalties yet against air carriers as a result of what happened over the holiday season? (or Why does it take so long to issue a monetary penalty?)

• One enforcement investigation has already been launched, and others may be, as we continue to receive and analyze information on the holiday flight disruptions.
• These may ultimately result in findings of violation and monetary penalties.
• Like any enforcement agency, the CTA has the responsibility for pursuing enforcement actions on the basis of the law and the evidence.
• Before issuing a notice of violation, CTA enforcement officers conduct a rigorous investigation, gathering information, reviewing documentation and interviewing airline staff and other witnesses, as part of building a solid case that meets the requirement for proving violations before of the Transportation Appeals Tribunal of Canada (TATC), which is the body before which CTA enforcement actions can be reviewed. The burden is ours to meet.
• This burden makes enforcement particularly demanding for legal requirements that depend on APPR categories of flight disruptions: for most passenger entitlements, it is necessary to first determine whether the flight disruption is within airline control, within airline control but required for safety, or outside airline control, to determine what were the obligations of the airline, what passengers are entitled to and whether they received it.

Q. How come the CTA has not taken firm action against airlines for the holiday disruptions the way that the U.S. has done with Southwest Airlines?

• Winter storms in the U.S., followed by major issues with their crew scheduling system, resulted in Southwest Airlines cancelling over 15,000 flights over the holidays, stranding thousands of passengers.
• U.S. transportation officials publicly warned the airline that they would face enforcement action if they did not meet their obligations to passengers, such as providing refunds.
• This highlights the fact that the U.S. and Canadian air passenger protection regimes are fundamentally different:
  • The U.S. has no regulated requirement to provide compensation for inconvenience, food or accommodations, and no specific mechanism for the adjudication of individual passenger complaints, except through the court system.
  • In the U.S. system, federal enforcement action is required to incentivize the resolution of passenger complaints by the airlines; hence the need for U.S. officials to signal that enforcement action would be forthcoming if Southwest did not take action on its own to resolve passenger complaints.
  • In our system, individual passenger complaints can be adjudicated by the CTA. Agency dispute resolution initiated by a complaint from a passenger is the primary means by which individual passengers are provided remedies (compensation, refunds) by airlines.

Q. Why didn't the CTA take stronger enforcement actions against air carriers in the summer that could have avoided what happened over the holiday season (or Why hasn't the CTA issued higher fines, up to the $25,000 maximum?)

• The objective of the CTA's compliance monitoring and enforcement activity is to achieve industry compliance with the regulations.
• As is the case with most other regulatory regimes, in enforcing the APPR, the CTA has a graduated approach to enforcement:
  • A first violation by an airline results in a moderate level of monetary penalties
  • Each subsequent violation of the same provision by the airline results in a doubling of the penalty, up to the maximum amount ($25,000 for the APPR).
• Because the APPR is relatively new, most notices of violation that have been issued so far have been for first violations.
• You will find our Compliance & Enforcement Policy on our website, along with detailed tables explaining the monetary penalties that are issued for each specific violation of the regulations, and how those penalties increase for each subsequent violation [they double for each subsequent violation, up to the maximum].

Q. Why doesn't the CTA issue many more monetary penalties?

• The primary means by which the CTA ensures compliance with the APPR is through complaint resolution, since complaint resolution can result in remedies to the individual passenger such as compensation or refunds.
• The objective of the CTA's compliance monitoring and enforcement activity is to achieve industry compliance with the regulations.
• The CTA proactively monitors airline compliance (through inspections and audits, for example), as well as through monitoring media reports, information tips and systemic issues identified from complaints.
• The CTA's enforcement officers selectively launch enforcement investigations to achieve the most significant positive impact on industry compliance.

Q. If the APPR isn't working to protect consumers, what needs to change?

• The coming into force of the APPR in 2019 was a significant step forward in protecting the rights of air passengers, establishing for the first time common minimum obligations that apply to all airlines operating in Canada.
• That being said, our experience in implementing the APPR has provided us with some valuable insight.
• For example, we learned through the widespread disruption of the air transportation system at the beginning of the COVID-19 pandemic that there was a gap in Canada's passenger protection framework, and we acted to close this gap as soon as we were given the necessary regulatory authority. Indeed, last September, regulatory amendments came into force requiring refunds to be offered even when a flight disruption is outside airline control and the airline is not able to rebook the passenger within a reasonable period of time.
• We have also learned that there are some areas where it would be beneficial to both passengers and airlines for there to be greater clarity:
  • In particular, the fact that passenger entitlements depend on how a flight disruption is categorized – within airline control, within airline control but required for safety or outside airline control – makes it difficult for passengers and airlines to know what passengers are entitled to, and makes the APPR more difficult to enforce, because of the number of factors to take into account in assessing this.
  • The CTA has addressed the important issues of categorization in some recent decisions, notably over the last summer with respect to flight disruptions due to crew shortages; however, an appeal to the Federal Court of Appeal is moving forward on one of these decisions.

Q. The CTA isn't meeting its own service standards: why not, and what are you doing to fix this?

• Failing to meet our service standards is obviously not what I want from my organization.
• I lead an organization with dedicated staff who are passionate about our mandate including the air passenger consumer protection regulations.
• Prior to the APPR coming into effect, the CTA anticipated a significant increase in complaints, particularly linked to fight disruptions. This is normal with any new regulatory regime.
• We could not have anticipated the onset of the pandemic, nor the impact it has had on the air industry, and which it continues to have as the industry recovers.
• All this – in addition to the complexity of the APPR itself - has resulted in a high level of complaints being filed with us overall, as well as sudden spikes in volume related to situations such as occurred over the recent holidays.
• As a stark example of how things have changed, in the year before the APPR came into force (2018-19), the CTA received about 7600 complaints. In the month of August 2022 alone we received almost 6,000 complaints.
• We continue to seek and find new efficiencies in how we process complaints, and we are determined to continue to reduce our wait times and processing capacity.
• We continue to find ways to provide more information to complainants – for example through our new Case Status Update application – and to passengers more generally, for example through publishing on our website the number of complaints per 100 flights received by the CTA for each airline.
• Overall, we are doing more cases with our resources than ever before, but the volume number of complaint received has continued to increase over time.

Are air passengers receiving refunds for cancelled and delayed flights?

• The pandemic highlighted a gap in the Air Passenger Protection regulatory framework:
  • The absence of a requirement for airlines to refund tickets when flights are cancelled, or where there is a lengthy delay, for reasons outside airline control and it is not possible for the airline to ensure that the passenger's itinerary is completed within a reasonable time.
• This gap was recently closed through an amendment to the regulations:
  • Since September 8, 2022, airlines must offer passengers a rebooking or a refund, even for flight disruptions outside airline control, if they are not able to rebook the passenger within 48 hours.

RESPONSIVE: 48-hour rebooking window

• In the case of flight disruptions outside carrier control only, airlines are provided with the opportunity to rebook a passenger within 48 hours of the original departure time, before having to offer a refund.
• The 48-hour rebooking window provides a balance between the needs of airlines and passengers. It recognizes that airlines may reasonably need more time to recover their schedules after a disruption that was outside their control. It also takes into account the unique realities and concerns of Canadian airlines, particularly those that work in the northern and remote locations where there are infrequent flights and where weather-related disruptions can be lengthier.
• In the case of events within carrier control a passenger would be entitled to a refund instead of rebooking, if the arrangements offered do not meet their travel needs, or there is no longer any purpose to the travel, because of the disruption.

RESPONSIVE: Is it not true that carriers have been required to offer refunds under Canadian law since 2004?

• Prior to 2019, the Agency had issued a number of decisions regarding refunds in specific cases adjudicated by the Agency, but there was no regulation or legislation which required airlines to provide refunds prior to the Air Passenger Protection Regulations.
• Following the amendment of the Canada Transportation Act in 2018 to allow for the making of the Air Passenger Protection Regulations, these earlier decisions helped to shape the regulatory proposals that were subsequently the subject of wide consultations, and which led ultimately to a new regulatory framework for the consumer protection of air passengers.
• This new regulatory framework provided that rebooking or refunds had to offered to passengers who experienced flight disruptions that were within airline control or within airline control, but required for safety.
• On December 21, 2020, the Minister of Transport issued a direction to the Agency, directing the CTA to amend the regulations to provide for a refund in the case of flight disruptions outside carrier control. The subsequent amendment came into force on September 8, 2022.

RESPONSIVE: Vouchers

• During the pandemic, before this regulatory amendment came into force, there was a concern that some passengers might not receive any form of repayment for the mass flight cancellations that were taking place.
• In that context, the Agency issued a statement on vouchers that was meant to ensure that this wouldn't happen.
• The statement did not affect the rights of passengers who believed that they were entitled to a refund under the tariff of a particular air carrier.
• The Agency was very clear that it would continue to respond to disputes on a case by case basis on their merits and it has done just that.

RESPONSIVE: Independence

• The Agency has recently published on our website a statement regarding our independence and impartiality.
• To perform some of its regulatory functions, the Agency does engage with government officials, with the industries it regulates, and with consumer and disability rights organizations. That engagement is required by law or government policy when the Agency develops certain regulatory instruments.
• In other situations, engagement allows the Agency to, for example, further its expertise to understand the transportation trends and issues it needs to take into account. Engagement allows the Agency to remain current and relevant, and to competently advance its mandate.

What is your backlog and how long will it take to respond to a new complaint received today? Do you have the resources to do your job? Do you think your organization is performing well?

• We continue to receive a high number of complaints, although the pace has reduced since the summer when, for example, we received 6000 complaints in the month of August. You can compare this to the period before the APPR came into force where we received 7650 complaints for the entirety of the 2018-2019 fiscal year. So far this Fiscal year we have received 28,000 complaints.
• Our current backlog is 33,000.
• We strive to make the best possible use of our resources and can now process over 10,000 complaints a year, compared to 5000 complaints per year before the pandemic.
• There will continue to be a high number of complaints and we will continue to review our processes to optimize our complaint handling capacity:
  • We have already found ways to more quickly review cases informally and formally through batching cases, streamlining our manual review processes and developing shorter decisions where possible
  • We are meeting with airlines regularly to discuss our processes and identify processing efficiencies
  • And we have launched a review to further explore process efficiency and automation
• We will effectively use the resources provided by Parliament to resolve as many complaints as possible.
  • This includes the $11.5 million in temporary funding that was provided until March 31, 2023 to maintain our existing staffing level.

What did the Agency do to respond to the disruptions experienced by passengers at airports last summer?

• The pandemic had a significant impact on the air transportation industry. What we were seeing during the summer was a challenging transition back to more normal operations.
• The Agency recognized that passengers needed information on their rights, in a way that was easy to access and consume, all while passengers were travelling and in the midst of experiencing disruptions.
• To this end, the Agency created a clear, simple guidance document for passengers that could be accessed and understood using a smart phone.
• The Agency also streamlined its website to take potential complainants through a step-by-step process to handle their dispute with the airline. Including what questions they should be asking and what receipts or proof they would need to keep.
• The Agency continued to respond to complaints and to issue decisions, prioritizing complaints where decisions by the Agency would have broad interpretive value to a significant number of complaints before the Agency, e.g. the Lareau and Crawford decisions on flight disruptions due to crew shortages being within airline control, and therefore subject to compensation for inconvenience.
• What I've said highlights the fact that the main way through which the Agency oversees compliance with the APPR is through the resolution of complaints made by passengers against airlines.
  • Complaint resolution is helpful individually to the complaining passenger since it can result in the passenger obtaining a remedy from the airline.
• The other way in which the Agency oversees compliance with the APPR is through compliance monitoring and enforcement activities.
• To that end, the Agency has a small number of designated enforcement officers.
• During the summer, these enforcement officers conducted blitzes at airports and launched investigations that resulted in notices of violation that have been posted on our website.
• More importantly, the engagement of enforcement staff with airlines resulted in the airlines correcting their behaviour by ensuring that the reasons for flights disruptions were properly communicated, and that passengers were provided the assistance they are entitled by the regulations.
• As a result of the investigations, instances of passengers having been incorrectly denied compensation were identified. Following these interventions, passengers were ultimately paid the compensation owed.

Do you think that the APPR works well, and is a good, effective regulation?

• For the first time in Canada, the Air Passenger Protection Regulations (APPR) established common minimal requirements for air passenger consumer protection that have to be respected by all airlines.
• Before the development of the APPR, each airline set out its own terms and conditions of carriage in a legal document known as a tariff - which is in effect the contract between the passenger and the airlines - that was rarely, if ever, read by passengers. After the coming into force of the APPR, in addition to the terms and conditions set out in their tariff, each airline is required to follow the obligations as set out in the APPR. These regulations create more consistent passenger rights across airlines.
• Passengers now have the opportunity to pursue their rights as consumers through the application of the APPR, and have done so in record numbers.
• At the core of the new regulations is a framework where passenger entitlements for flight disruptions depend on the degree of control an airline has over a disruption.
  • Passenger entitlements depend on whether flight disruptions are within airline control, within airline control but required for safety, or outside airline control.
• The regulations leave room for intepretation. As the Agency makes decisions on complaints and courts make decisions on Agency decisions which are appealed, the interpretation of the regulations will become more clear.
• The Agency has issued decisions in response to complaints that interpret the APPR and clarify passenger rights and airline obligations.
  • While complaints are generally reviewed on a First Come First Serve basis , the Agency can also prioritize those complaints that have broad, interpretive value for the efficient resolution of complaints and the enforcement of regulatory requirements.
• Overall, passengers have a more comprehensive protection regime than before the APPR. As a result, they are better protected.
• It is fair to say that the difficulty this regime presents for passengers is that it difficult for them to know the compensation they are entitled to, since airlines have the information to determine whether the incident is within their control, within their control but required for safety, or outside their control. Therefore, if the passenger is not satisfied with the response from an air carrier, they have to lodge a complaint.
• This has contributed to the increase in the number of complaints we receive.

In brackets are the years for which this item was included in the annual report (for the fiscal year ending in that date i.e. 2021= the FY ending in March 2021)

The full details for each item and the rational can be found in the annual report:

• Annual Report 2020–2021
• Annual Report 2019–2020
• Annual Report 2018-2019
• Annual Report 2021–2022

Air passenger protection

• to allow the CTA to look into possible issues (reasonableness or clarity) with domestic tariffs on its own motion, consistent with the authority it has for international tariffs. (2022, 2021, 2020)
• so that passengers and airlines can participate in facilitation without any concern that their information and positions will be shared with others (currently does not require parties to keep confidential the discussions that took place during the facilitation, including the detail of any settlement). (2021,2020)
• to require participants be directed to mediation before a formal adjudication process can be launched. (2020)
• to be given a clear authority to set more robust standards for passenger protection—including refunds—when flights are cancelled for reasons outside of an airlines' control. (2020)
• to give the ability to proactively gather information on flight disruptions that could give rise to complaints. Currently the Agency is only able to examine passenger issues, following the receipt of a complaint. (2022)
• The Act could be amended to give the authority to public servants, instead of GIC-appointed Members, to decide on passenger complaints that an airline has not met its obligations (2022)

Accessible transportation

• to provide the CTA with remedial powers when investigating systemic issues on its own motion. (2022, 2021, 2020)
• to require transportation service providers to report on key accessibility service metrics. (2021, 2020)

National transportation network

• to prohibit contractual provisions which waive the rights of shippers to access remedies otherwise available under the legislation, and any retaliatory actions against shippers that submit applications to the CTA. (2021, 2020)

Own-motion investigations

• allow the CTA to, on its own initiative, investigate rail level of service matters and inquire into matters that concern transportation and relate to the mobility of persons with disabilities, without obtaining the Minister’s approval. (2021, 2020)

Appeals of CTA decisions

• to specifically state that the intended standard of review for CTA decisions is reasonableness rather than correctness (2022, 2021, 2020)
• to clarify the right of the CTA to appear in appeals of its decisions to the Federal Court of Appeal (FCA) and to confirm the scope of its participatory right. (2022, 2021, 2020, 2019)
• to remove the ability for a party—generally, industry—to petition government to overturn CTA decisions. It is not clear why this is in the Act, given there is a right of appeal of CTA decisions to the Federal Courts of Appeal. (2020)
• to clarify the role of the two different bodies called to interpret the same legislative and regulatory provisions – i.e. the Agency when exercising its adjudicative and regulatory powers under the Act, including the power to review Notices of violation (NoVs) containing a warning, and the Transportation Appeal Tribunal of Canada (TATC) when reviewing NoVs issued by an Agency's designated enforcement officer. (2022)

Authority to act on behalf of the Crown – Duty to consult Indigenous people

• to allow the CTA to act on behalf of the Crown in discharging the duty to consult with Indigenous persons. (2021, 2020)

Members

• Removing the requirement for Members to reside in the National Capital Region. (2022)
• to authorize the Chair to draw Temporary Members directly from the roster, rather than being required to ask the Minister of Transport to appoint them. (2021, 2020, 2019)
• to remove or raise the three-person cap on the number of Temporary Members. (2021, 2020, 2019)
• to allow Temporary Members to serve more than two consecutive one-year terms. (2021, 2020, 2019)

Ability to delegate routine matters to employees

• to allow the CTA to delegate routine matters, with minimal scope for discretion, to staff (ex. the issuance of uncontroversial air licences, charter permits, uncontested coasting trade applications etc.) (2022, 2021, 2020, 2019)

Updating the CTA’s compliance assurance toolkit

• to allow enforcement officers to rely on the CTA’s adjudicative findings when determining whether to levy an AMP. (2021, 2020, 2019)
• to increase the maximum amount for AMPs for most violations from $25,000 for corporations and $5,000 for individuals—to $250,000. (2021, 2020, 2019)
• to allow Designated Enforcement Officers to issue more than a single Notice of Violation for continuing offences (e.g., when there is a failure to have proper signage and is not remedied by a carrier after a Notice of Violation has been issued). (2021)
• to allow the Agency to enter into compliance agreements with transportation service providers. Amending the Act to add compliance agreements, as well as other powers currently found in the Accessible Canada Act, would give us modern and consistent enforcement tools across all of our mandates. (2022)
• Extending the statute of limitations to 24 months for both prosecutions and issuance of NoVs (2022)

APPR Enforcement – Speaking Points

• The Agency has many tools to advance its regulatory mandate with respect to passenger protection, including our authority to resolve passenger complaints against airlines as a quasi-judicial tribunal and to enforce industry compliance as a Regulator. The Agency believes that these actions, combined, are the best way to ensure that industry and passengers understand their respective rights and obligations, and to achieve compliance with the regulations.
• Through the complaints process, if the Agency finds that the airline has failed to meet its APPR obligations, it can order the airline to provide passengers what they are entitled to, whether it is compensation for inconvenience, refunds, or compensation for expenses they have incurred as a result of the airline's failure to comply with the APPR. For this reason, the main way we provide consumer protection for air passengers is by resolving their complaints against airlines.
• Additional compliance tools, including compliance and monitoring activities done by our small team of 7 designated enforcement officers, are utilized strategically based on a series of factors including severity and risk. They include proactive monitoring and enforcement of the regulations, and issuing notices of violation (NoV) with administrative monetary penalties (AMP), where required. Unlike the process for the resolution of complaints, however, enforcement actions do not result in any compensation to individual passengers.
• Aspects of the APPR that are handled by compliance and enforcement include: carrier obligations related to its communication with passengers when a flight is delayed or cancelled; carrier obligations to provide passengers with food, drinks, accommodations and refunds when required and compelling carriers to provide passengers with compensation (or reason for denying compensation) within 30 days^{Note 1}.
• As per the Agency's Compliance and Enforcement Policy, Designated Enforcement Officers address non-compliance by applying a graduated approach, using both informal and formal enforcement measures. They undertake a thorough analysis to select the enforcement instrument that will be the most effective in causing the entity to return to or achieve compliance and prevent recurrence. This approach, as well as our use of AMPs to compel compliance with the APPR, is consistent with that other regulators with an enforcement mandate.
• In response to the winter 2022 disruptions in the air industry, enforcement officers have undertaken an investigation into Sunwing's provision of information to passengers related to the delays and cancellations of flights during the winter disruptions, which resulted in many passengers being delayed in southern destinations.
• Enforcement officers have also undertaken 14 compliance verifications involving 3 Canadian and 6 foreign carriers related to tarmac delays at the Vancouver Airport resulting from the winter storm on December 19, 2022. Some of those verification activities may lead to investigations.
• Additionally, the enforcement team is monitoring media and complaints data and analyzing for indicators of potential non-compliance with the APPR and/or carriers' tariffs. Enforcement officers will also monitor to ensure that compensation payments or responses are being provided to passengers within 30 days (per s.19(4)) and to ensure that refunds are being provided to eligible customers (per s.18.2).
• In response to the summer 2022 disruptions in the air industry, enforcement officers have responded by conducting onsite inspections of Canadian and foreign air carriers at the Montreal, Toronto and Vancouver airports. This led to investigations resulting in the issuance of AMPs to Air Canada, WestJet and Delta. Also, the enforcement team has been analyzing samples of cancelled flights and complaints data which has led to investigations into whether compensation may be owed to passengers. As a result of the Enforcement team's intervention, WestJet has paid $56,700 in compensation to passengers who had previously been denied compensation and Air Canada has also paid compensation to 117 passengers related to 4 flights. Finally, enforcement officers have also been investigating carriers' delayed response to passenger compensation requests, which has resulted in the issuance of AMPS to Air Canada for $13,400, WestJet for $11,000 and to Flair for $28,000. Similar investigations with other air carriers are ongoing.
• Since the coming to force of the APPR obligations in July 2019 the CTA has issued 80 Cautionary Notices and subsequently worked with carriers to bring them into compliance; and has issued $184,800 in AMPs relating to the APPR specifically, of which $96,850 are attributed to AMPs issued since April 1 of this year (52%).
• The value of an AMP issued to an entity after a regulation has come into force, reflects a lower penalty amount for a first violation, in accordance with general principles applicable to the establishment of penalty amounts, and taking into account any mitigating and aggravating factors. Penalty amounts increase for second and subsequent violations. Since the APPR is fairly new, AMPs issued thus far have been for first violation.

APPR – Early Enforcement Milestones

• The CTA moved quickly to enforce the new APPR during the summer of 2019 in the weeks following the coming-into-force of the first set of APPR requirements, then again in December when the second phase came into effect, sending Enforcement Officers to airports to conduct compliance verification blitzes of major Canadian and foreign airlines, particularly in relation to their new communication requirements.
• Enforcement officers also conducted investigations related to instances of tarmac delays which resulted in the issuance of an AMP of $2,500 to Air Transat.
• On February 13, 2020, the CTA opened an inquiry into 567 air travel complaints from passengers alleging that air carriers did not accurately communicate the reasons for flight delays or cancellation, and appointed the CTA's Chief Compliance Officer as the Inquiry Officer to look into the matter.
• The Inquiry Officer submitted his Report on Oct. 1, 2020. He found multiple communication issues leading to passenger frustration and concluded based on the evidence that information provided to passengers was inadequate, terse and unclear. However, he found no evidence that the airlines deliberately mischaracterized the reasons for delays and cancellations.
• The report also highlighted issues related to how the airlines categorized flight disruptions. This report was part of the evidence considered by the Agency when it issued Decision No. 122-C-A-2021 on Nov. 17, 2021 in which the Agency established a number of principles regarding the interpretation of provisions of the APPR, that brought clarification regarding passengers and carriers' rights and obligations. In that decision, the Agency directed each of the six carriers involved in the 567 complaints to reconsider each the requests for compensation for inconvenience that they had received.
• With the onset of the COVID-19 pandemic; and the resulting travel restrictions and Government health measures in March 2020, the CTA pivoted to a remote compliance verification strategy to ensure continued oversight of the APPR.
• The CTA continued to focus on communication requirements, verifying carrier websites to ensure they complied with requirements to include their services and obligations to passengers respecting flight delays and cancellations among other things; ensuring that carriers' tariffs (their contracts with passengers) met, at a minimum, new APPR requirements.
• With the resumption of air travel in the fall of 2021, the CTA resumed on-site inspections in addition to ongoing virtual inspections. Enforcement efforts were targeted to issues related to communicating the reasons for a flight disruption, assistance and compensation.

Enforcement

• The coming into force of the APPR in 2019 resulted in a first wave of passenger complaints, which led to the APPR Communications Inquiry, and a first round of interpretation of the APPR by the Agency in November 2021.
• This first wave of complaints was followed by the near-shutdown of air travel as the COVID-19 pandemic took hold.
• As air travel returns to pre-pandemic levels, and as more complaints are adjudicated and more interpretation of the APPR is provided, designated enforcement officers will have a stronger basis for issuing notices of violation and administrative monetary penalties.
• Notwithstanding the disruption to normal travel patterns during the pandemic period, designated enforcement officers have issued 80 warnings ("Cautionary Notices") and $184,800 in administrative monetary penalties to airlines for violations of the APPR since its coming into force.

Winter 2022 flight disruption response

• In response to the winter 2022 disruptions in the air industry, enforcement officers have undertaken an investigation into Sunwing's provision of information to passengers related to the delays and cancellations of flights during the winter disruptions, which resulted in many passengers being delayed in southern destinations.
• Enforcement officers have also undertaken 14 compliance verifications involving 3 Canadian and 6 foreign carriers related to tarmac delays at the Vancouver Airport resulting from the winter storm on December 19, 2022. Some of those verification activities may lead to investigations.
• Additionally, the enforcement team is monitoring media and complaints data and analyzing for indicators of potential non-compliance with the APPR and/or carriers' tariffs. Enforcement officers will also monitor to ensure that compensation payments or responses are being provided to passengers within 30 days (per s.19(4)) and to ensure that refunds are being provided to eligible customers (per s.18.2).

Summer 2022 flight disruption response

• Since July 1, 2022 the Agency has undertaken a series of compliance verification activities to confirm that Canadian and foreign air carriers are complying with the requirements of the Air Passenger Protection Regulations related to flight delays and cancellations:

Inspections of Air Carriers at Major Airports

• Designated enforcement officers (DEOs) have been performing onsite verifications at three of the largest Canadian airports, which had the highest rates of flight delays and cancellations this summer: Montreal, Toronto and Vancouver.
• DEOs evaluated the information provided, assistance and alternate travel arrangements provided to passengers related to 43 delayed or cancelled flights, involving 11 Canadian and foreign air carriers.
• These verification activities resulted in 8 Targeted Investigations (3 NoVs have been issued, 1 each to Air Canada and WestJet and 1 to Delta. (Delta is seeking review by the Transportation Appeal Tribunal of Canada (TATC)). Some of these activities have led to further investigations regarding compensation eligibility for the impacted passengers and payment of compensation is being monitored related to an Flair flight.

Analysis of Flight Delay & Cancellation Data

• The Agency is increasingly analyzing complaint and flight data to inform investigations. This has led to recent interventions by Enforcement into airline practices respecting their categorization of the reason for flight disruptions.
• Since July 4, 2022 the Enforcement team has analyzed flight data provided by four Canadian air carriers related to approximately 1,100 delayed or cancelled flights occurring over a two-week period in June 2022; and corresponding complaints received by the Agency pertaining to those flights.
• Informed by this data analysis of the 1,100 flights, DEOs have conducted 7 investigations related to three carriers. As a result of the Enforcement team's intervention, WestJet recently re-categorized flights and paid $56,700 in compensation to passengers who had previously been denied compensation. WestJet continues to review other flights to assess the need for additional re-categorizations.
• Additionally Air Canada has agreed to compensate 117 passengers who were previously denied compensation.

Audit of Potentially Mis-categorized Flights

• Based on the results of the analysis of flight delay and cancellation data provided by the four Canadian air carriers in the context of investigations undertaken in the summer, in mid-September 2022, to identify other flights that may have been potentially mis-categorized by air carriers, for the purpose of deciding passengers entitlements, the Enforcement team began examining additional flight records at carrier headquarters, related to flight disruptions attributed to crew issues, and corresponding complaints received by the Agency. The Enforcement Officers examined air carrier processes for determining the categorization of flight delays and cancellations, and related obligations. They also considered the air carriers' operating procedures and contingency plans as part of their evaluations.
• Fifty flights were reviewed at Air Canada and four were identified by DEOs as problematic and Air Canada has agreed to compensate 117 passengers who were previously denied compensation.
• WestJet is currently reviewing their categorization of certain flights, following the completion of the Enforcement team’s investigation in the summer of the carrier’s flight delay and cancellation data. Verification activities will resume after that, as required.
• A review of Flair flights resulted in an investigation that is currently underway.

Carrier Obligation to Provide Responses to Passenger Claims Within 30 Days (ss. 19(4) APPR):

• In August 2022 the Enforcement team began examining passenger complaints filed with the Agency which included an allegation that the carrier delayed response to passenger compensation claims. This project reconciled passenger complaints to the Agency regarding delayed responses, with information obtained from the carriers to identify potential non-compliances.
• A Notice of Violation was issued to Air Canada related to 67 files – totaling $13,400 in penalties.
• A Notice of Violation was issued to WestJet related to 55 files – totaling $11,000 in penalties.
• A Notice of Violation was issued to Flair related to 140 files – totaling $28,000 in penalties.
• Similar investigations are pending for Air Transat and Swoop.

APPR Enforcement Statistics

The following table provides an overview of the Notices of Violation and related Administrative Monetary Penalties issued in respect of the APPR since its coming into force:

Overview

• DEOs conduct compliance verification and monitoring activities to confirm whether subject entities are meeting their regulatory obligations. When they identify non-compliance they draw on a range of available enforcement tools to ensure compliance by regulated parties. Their work is aligned with the Agency’s Compliance and Enforcement Policy.
• Their oversight activities encompass the Agency’s three mandates: consumer protection, accessibility and efficient transportation, and a broad regulatory portfolio, including the Canada Transportation Act, the APPR and ATPDR

The following table provides an overview of the oversight activities that have been undertaken since 2019 (not limited to APPR):

Compliance Monitoring and Enforcement - Inspections and Investigations

Activity descriptions:

• Carrier Inspections verify carrier compliance at their places of business
• Facility Inspections verify terminal operator compliance within the terminal
• Carrier monitoring at terminals verify the compliance of carriers at terminals
• Website monitoring proactively monitors entity websites to verify compliance
• Targeted verifications assess specific, potential non-compliances
• Targeted investigations are conducted when there are reasonable grounds to believe a contravention has occurred
• Follow-up on Agency Orders ensures that entities fulfill the obligations set out in Agency Orders

Since 2019, DEOs have taken the following enforcement actions related to violations that have been identified during their inspections and investigations:

Compliance Monitoring and Enforcement - Contraventions

Note:

• The numbers related to the following categories: "Notice of Violation - with Administrative Monetary Penalty"; "Total number of violations found"; and "Total amount of Penalties" - are subject to change where Notices of Violation or specific violations are withdrawn or reserved by the Transportation Appeal Tribunal of Canada.
• The numbers in this table reflect the value of each category in the identified year, and may not be aligned with current information on Canada Transportation Agency's website, as a result of the aforementioned changes.
• Notices of violation - with warning: This is a new power under the Canada Transportation Act, as amended by the Act to Ensure a Barrier-Free Canada (Accessible Canada Act).

The value of an Administrative Monetary Penalty issued to an entity after a regulation has come into force, reflects a lower penalty amount for a first violation, in accordance with general principles applicable to the establishment of penalty amounts, and taking into account any mitigating factors. Penalty amounts increase for second and subsequent violations. 

Analysis of Compliance Statistics – By Mandate

Consumer Protection

2022 – 23

• The Agency is currently undertaking compliance verifications in response to winter 2022 flight disruptions.
• The Agency conducted blitzes monitoring information and assistance provided to passengers in response to delayed and cancelled flights at the three Canadian airports that had the highest rates of flight disruptions this summer: Montreal, Toronto and Vancouver.
• The Enforcement team analyzed flight data provided by select Canadian air carriers and complaints received by the Agency to inform investigations into air carrier categorization of flight disruptions and their related compensation obligations.

2021 – 22

• The Agency conducted 19 virtual inspections of Canadian carriers' domestic tariffs to ensure compliance, resulting in 5 cautionary notices^{Note 2}.
• The APPR includes air price advertising requirements. These requirements allow consumers to determine the total price of advertised air services easily. In the Agency's work, it:
  • monitored the advertised air prices of 28 air carriers (and travel agencies),
  • issued 22 cautionary notices, and
  • issued three NoVs with penalties.

2020-21

• The CTA monitored compliance by Canadian and foreign airlines with the APPR. We issued 33 cautionary notices for potential non-compliance with APPR communication provisions. All cautionary notices were addressed by the airlines.
• We monitored the advertised air prices of 22 foreign air carriers.

2019-20

• The CTA's enforcement officers conducted compliance verifications at airports across the country and involving a tarmac delay at the Rome—Fiumicino Leonardo da Vinci International Airport. These activities led to findings of violations for failure to display notices of passenger rights at airports and failure to provide certain standards of treatment during a tarmac delay, resulting in the issuance of 9 notices of violations with administrative monetary penalties totaling $60,000.
• The Agency’s enforcement officers also issued cautionary notices for alleged non-compliance with certain communications requirements during flight delays.

Accessible transportation

2022 – 23

• The Agency has conducted investigations into five incidents involving four Canadian air carriers. One of the incidents related to damage to a mobility device. Two investigations related to the possible mishandling of passengers while they were being transferred to airplane seats. The fourth investigation involved charging for the transportation of a medical device, and the fifth involved the carrier's refusal to transport a mobility aid.

2021 – 22

• The Agency has initiated over 40 inspections to verify compliance with the ATPDR, supported by self-reporting questionnaires, and followed by virtual and on-site meetings. Where deficiencies were detected, compliance plans were developed which detailed how, and by when, the TSPs were expected to be in full compliance with the applicable requirements. The Agency is working with TSPs to ensure that they achieve compliance in 2022.
• The Agency also entered into its first compliance agreement with a transportation service provider.

2020 – 21

• The majority of the new ATPDR provisions came into force on June 25, 2020. The Agency moved quickly to:
  • verify compliance by regulated entities;
  • monitor the websites of regulated entities;
  • conduct targeted outreach to regulated entities to ensure compliance with the new communications requirements.
  • The Agency issued four notices of violations, two with penalties totaling $28,000 for non-compliances with the Personnel Training for the ATPDR.

2019-20

• No enforcement actions were issued that year but inspections were performed at various airports in the country on whether airports were complying with the Personnel Training for the Assistance of Persons with Disabilities Regulations in February 2020 which resulted in notices of violation being issued in the fiscal year 2020/21.

Efficient Transportation – Rail and Air Transportation

2021-22

• The Agency investigated Skyservice Business Aviation Inc. for operating international passenger charters without obtaining the required charter permits. This resulted in the issuance of an NoV with administrative monetary penalty.
• The Agency is actively monitoring compliance with section 136.9 of the Act. This requires railway companies to publish a list of interchange locations. The Agency conducted 20 virtual inspections of federally regulated railway companies to ensure that the interchange lists were accurate and current. Nine railway companies have since been brought into compliance.
• The Agency conducted two investigations to verify compliance by Canadian National Railway (CN) and Canadian Pacific Railway (CP) with the interswitching regulated rate under subsection 127(3) of the Act. These were for interswitching at the St-Luc interchange (Montreal) and destination facilities located on the south shore of Montreal. The Agency issued notices of violations and administrative monetary penalties to CN and CP.

2020-21

• Our enforcement officers investigated air carriers suspected of operating without a licence or necessary charter permits. These investigations resulted in the issuing of four notices of violation with penalties totalling $26,500.

2019-20

• Agency issued a Notice of Violation with an administrative monetary penalty of $5,000 to an air carrier for operating international passenger charters without obtaining the required charter permits.
• Regulations Amending Certain Regulations Made Under the Canada Transportation Act (Rail Transport): SOR/2019-254 came into force on June 25, 2019. The coming into force of the these regulations, ensured that rail provisions under the Canada Transportation Act, Railway Interswitching Regulations, and Railway Third Party Liability Insurance Coverage Regulations could be enforceable by administrative monetary penalties.

Follow up on Agency orders and decisions

2022-23

• In the first three quarters of fiscal year 2022-23, the Agency has verified compliance with 41 orders by following up with passengers and transportation service providers, including:
  • air passengers receiving compensation and refunds, as ordered by the Agency;
  • air carriers amending their tariffs to ensure transparency with passengers about their terms and conditions;
  • confirming that transportation service providers developed or amended their policies to address the removal of barriers for persons with disabilities.

2021-22

• The Agency verified compliance with 36 orders by following up with passengers and transportation service providers, including:
  • collaborating with other government agencies to ensure CN complies with the conditions of the Milton logistics hub approval;
  • air passengers receiving compensation and refunds, as ordered by the Agency;
  • air carriers amending their tariffs to ensure transparency with passengers about their terms and conditions;
  • ensuring transportation service providers communicate with their employees about existing and new transportation policies that allow persons with disabilities to better access air travel; and
  • confirming that transportation service providers developed or amended their policies to address the removal of barriers for persons with disabilities.

2020-21

• The Agency verified compliance with 44 CTA orders. These included:
  • ensuring passengers were provided compensation and reimbursements;
  • confirming air carriers amended their tariff as ordered;
  • verifying that regulated entities communicated with their employees about existing and new policies on accessibility that affect air and rail passengers;
  • confirming regulated entity policies respecting the removal of barriers for persons with disabilities were developed or amended; and,
  • receiving and analyzing reports as ordered that outline a regulated entity’s continuing compliance efforts.

2019-20

• The Agency verified compliance with 42 CTA orders. These included:
  • ensuring passengers were provided compensation and reimbursements;
  • confirming air carriers amended their tariff as ordered;
  • verifying that regulated entities communicated with their employees about existing and new policies on accessibility that affect air and rail passengers;
  • confirming regulated entity policies respecting the removal of barriers for persons with disabilities were developed or amended; and,
  • receiving and analyzing reports as ordered that outline a regulated entity’s continuing compliance efforts.

Comparative Analysis – Other Government Departments/Agencies

• From January 2020 to August 2022, the CTA (with 355 employees as of March 2021 and 7 DEOs) issued 31 NoVs with an AMP, 2 NoVs with a warning, and 112 Cautionary Notices.
• In comparing the CTA with other regulators with similar employee size:
  • Financial Transactions and Reports Analysis Centre of Canada (401 employees as of March 2021) issued 21 NoVs with an AMP.
  • Canadian Radio-television and Telecommunications Commission (541 employees as of March 2021) issued 86 citations and 37 NoVs with an AMP.
  • Canada Energy Regulator (553 employees as of March 2021) issued 2 Warning Letters and 5 AMPs.
• In comparing the CTA with other regulators with larger employee size:
  • Canadian Nuclear Safety Commission (862 employees as of March 2021) issued 3 AMPs.
  • Canadian Food Inspection Agency (6,539 employees as of March 2021) issued 230 NoVs with a warning and 224 NoVs with an AMP.
  • Health Canada (Pest Control Products) (9,204 employees as of March 2021) issued 23 NoVs with an AMP and 10 Warning Letters.
  • Transport Canada (6,339 employees as of March 2021)
    • Civil Aviation issued 323 Warning Letters, 133 Verbal warnings, and 264 AMPs.
    • Aviation Security issued 830 Warning Letters, 304 Verbal Warnings, and 66 AMPs.
    • Marine Safety issued 7 Warning Letters and 100 AMPs.
    • Marine Security issued 106 Warning Letters, 614 Verbal Warnings, and 11 AMPs.
    • Rail Safety issued 1,530 Warning Letters and 19 AMPs.

Statement on Updated Compliance and Enforcement Policy

Key Messages:

• On July 1, 2022 the Agency introduced its updated Compliance and Enforcement Policy reflecting our evolution to a new results-based and risk-informed approach to compliance assurance. The updated Policy is outcome focused and supports the Agency’s three core mandates.
• The Policy sets out how the Agency targets its compliance monitoring and enforcement resources to maximize proactive compliance by regulated entities with the legal obligations the Agency oversees.

Background:

• On July 1, 2022 the Agency introduced its updated Compliance and Enforcement Policy reflecting our evolution to a new results-based and risk-informed approach to compliance assurance.
• The Policy sets out how the Agency targets its compliance monitoring and enforcement resources to maximize proactive compliance by regulated entities with the legal obligations the Agency oversees.
• The Policy is outcome focused and supports the Agency’s three core mandates. of providing consumer protection for air passengers and ensuring a national transportation system that is accessible and runs efficiently and smoothly.
• The Policy speaks to four guiding principles:
• Results-based enforcement: In securing compliance, the measures applied are intended to advance the outcomes pursued by the Agency.
• Data-driven, risk-informed decision making: the Agency’s work is informed by data to identify potential non-compliances and optimize resource allocation;
• Fair, objective and consistent processes: Rules and processes for inspections, investigations and enforcement are clear and applied consistently and objectively; and
• Transparency: the Agency publishes the results of its formal enforcement actions on its website.
• Recognizing that public interest objectives are best served when regulated entities undertake and comply with applicable standards and legal obligations voluntarily, the Agency resolves non-compliance by applying a graduated approach to enforcement, using informal and formal enforcement measures.
• Guided by the Policy, the Agency employs a number of different tools and activities to foster compliance and address instances of non-compliance such as: compliance promotion, verification, enforcement (cautionary notices and Administrative Monetary Penalties) and follow-up.

1.(b) Statement on 2022/23 Compliance & Enforcement Work Plans

Key Messages:

• The Agency has prepared three compliance promotion and verification work plans for the 2022-23 fiscal year. The plans align the Agency’s three core mandates and include activities related to passenger protection, accessibility and rail.
• The plans were developed using a risk-based approach to maximize Agency resources and provide flexibility to respond to emerging issues and concerns raised by users of the Canadian transportation system.

Background:

• The work plans (three) guide the Agency's planned compliance promotion and verification activities for the 2022-23 fiscal year. They align with the Agency’s three core mandates and cover compliance aspects related to passenger protection, accessibility and rail.
• The plans also align with the Compliance and Enforcement Policy, engaging across the full compliance continuum (promotion, verification, enforcement, follow-up).
• The plans reflect knowledge gained from compliance activities undertaken in recent years, during which new passenger protection and accessibility regulations were introduced and when rail legislative provisions were designated.
• The plans reflect the impacts of COVID-19 on industry and the travelling public and are a restart of the proactive onsite inspections that had been disrupted by the pandemic.
• The plans were developed using a risk-based approach to maximize Agency resources and provide flexibility to respond to emerging issues and concerns raised by users of the Canadian transportation system.

2.(d) Statement on Key Issues - Agency's response to summer 2022 Air disruptions- Compliance & Enforcement

Key Messages:

• Enforcement officers have been performing onsite inspections of Canadian and foreign air carriers at the Montreal, Toronto and Vancouver airports which had the highest rates of flight delays and cancellations this summer. This led to investigations resulting in the issuance of Administrative Monetary Penalties (AMPs) to Air Canada, WestJet and Delta.
• The Agency is increasingly using data to inform compliance and enforcement of the APPR. The Enforcement team has analyzed flight data provided by select Canadian air carriers and complaints received by the Agency. This data informed investigations into air carrier processes for determining the categorization of flight delays and cancellations, and related compensation obligations.
• As a result of the Enforcement team's intervention, WestJet and Air Canada are reviewing whether compensation may be owed to passengers on certain flights. To date, WestJet has re-categorized flights and paid $56,700 in compensation to passengers who had previously been denied compensation and Air Canada has agreed to compensate 117 passengers who were previously denied compensation.
• Enforcement officers have also been examining complaints filed with the Agency related to delayed response to passenger compensation requests submitted to air carriers. To date, this has resulted in the issuance of AMPs to Air Canada for $13,400, WestJet for $11,000 and to Flair for $28,000. Similar investigations with other air carriers are ongoing.

Background:

Current and Ongoing Activities

• Since July 1, 2022 the Agency has undertaken a series of compliance verification activities to confirm that Canadian and foreign air carriers are complying with the requirements of the Air Passenger Protection Regulations related to flight delays and cancellations.

Inspections of Air Carriers at Major Airports

• Designated enforcement officers (DEOs) have been performing onsite verifications at three of the largest Canadian airports, which had the highest rates of flight delays and cancellations this summer: Montreal, Toronto and Vancouver.
• DEOs evaluated the information provided, assistance and alternate travel arrangements provided to passengers related to 43 delayed or cancelled flights, involving 11 Canadian and foreign air carriers.
• These verification activities resulted in 8 Targeted Investigations (3 NoVs have been issued, 1 each to Air Canada and WestJet and 1 to Delta. (Delta is seeking review by the Transportation Appeal Tribunal of Canada (TATC)). Some of these activities have led to further investigations regarding compensation eligibility for the impacted passengers and payment of compensation is being monitored related to an Flair flight.

Analysis of Flight Delay & Cancellation Data

• The Agency is increasingly analyzing complaint and flight data to inform investigations. This has led to recent interventions by Enforcement into airline practices respecting their categorization of the reason for flight disruptions.
• Since July 4, 2022 the Enforcement team has analyzed flight data provided by four Canadian air carriers related to approximately 1,100 delayed or cancelled flights occurring over a two-week period in June 2022; and corresponding complaints received by the Agency pertaining to those flights.
• Informed by this data analysis of the 1,100 flights, DEOs have conducted 7 investigations. As a result of the Enforcement team's intervention, WestJet recently re-categorized flights and paid $56,700 in compensation to passengers who had previously been denied compensation. WestJet continues to review other flights to assess the need for additional re-categorizations.
• Additionally Air Canada has agreed to compensate 117 passengers who were previously denied compensation.

Audit of Potentially Mis-categorized Flights

• Based on the results of the analysis of flight delay and cancellation data provided by the four Canadian air carriers in the context of investigations undertaken in the summer, in mid-September 2022, to identify other flights that may have been potentially mis-categorized by air carriers, for the purpose of deciding passengers entitlements, the Enforcement team began examining additional flight records at carrier headquarters, related to flight disruptions attributed to crew issues, and corresponding complaints received by the Agency. The Enforcement Officers examined air carrier processes for determining the categorization of flight delays and cancellations, and related obligations. They also considered the air carriers' operating procedures and contingency plans as part of their evaluations.
• Fifty flights were reviewed at Air Canada and four were identified by DEOs as problematic and Air Canada has agreed to compensate 117 passengers previously denied compensation.
• WestJet is currently reviewing their categorization of certain flights, following the completion of the Enforcement team’s investigation in the summer of the carrier’s flight delay and cancellation data. Verification activities will resume after that, as required.
• A review of flights another Canadian carrier is currently underway.

Carrier Obligation to Provide Responses to Passenger Claims Within 30 Days (ss. 19(4) APPR):

• In August 2022 the Enforcement team began examining passenger complaints filed with the Agency which included an allegation that the carrier delayed response to passenger compensation claims. This project reconciled passenger complaints to the Agency regarding delayed responses, with information obtained from the carriers to identify potential non-compliances.
• A Notice of Violation was issued to Air Canada related to 67 files – totaling $13,400 in penalties.
• A Notice of Violation was issued to WestJet related to 55 files – totaling $11,000 in penalties.
• A Notice of Violation was issued to Flair related to 140 files – totaling $28,000 in penalties.
• Similar investigations are pending for Air Transat and Swoop.

Enforcement actions

A Designated Enforcement Officer's (DEO) response to non-compliance escalates in severity depending upon the nature of the violation and the compliance history of the regulated entity. When a DEO believes that a regulated entity has committed a violation of the Canada Transportation Act (Act) or regulations, or when a regulated entity has not complied with a CTA Order, the following enforcement actions are available:

• Issuing a Notice of Violation Setting an Administrative Monetary Penalty

  A DEO may issue a Notice of Violation (NOV) setting out the administrative monetary penalty (AMP) that the regulated entity is liable to pay. AMPs are administered based on a progressive scheme of penalties aimed at fostering compliance.

• Issuing a Notice of Violation that Contains a Warning for Contraventions of Accessibility Provisions

  A DEO who believes that a regulated entity has committed a violation of an obligation made for the purpose of identifying or removing barriers or preventing new barriers in the federal transportation network to the mobility of persons with disabilities may issue an NOV that contains a Warning.

  This is a new power under the Act, as amended by the Accessible Canada Act.

Severity Levels

The CTA has assigned a severity level for each of the legislative or regulatory provisions that are subject to an AMP, from Level A to Level D. A violation of a Level A provision is considered to be strictly administrative in nature, progressing to Level D, the most serious, as described in the following table:

Under the CTA's penalty scheme, progressively higher penalties for repeat violations are imposed. Each subsequent violation of the same provision of the Act or Regulations within a four-year period by the same entity will result in progressively higher penalty amounts, up to the maximum amount specified for each provision.

Administrative Monetary Penalties (various maximum penalty amounts up to $25,000)

Applicable to certain provisions of the:

• Canada Transportation Act
• Air Transportation Regulations
• Air Passenger Protection Regulations
• Railway Third Party Liability Insurance Coverage Regulations
• Railway Interswitching Regulations

Administrative Monetary Penalties (maximum penalty amount of $250,000)

Applicable to certain provisions of the:

• Air Transportation Regulations (Part VII)
• Personnel Training for the Assistance of Persons with Disabilities Regulations
• Accessible Transportation for Persons with Disabilities Regulations

Once an NOV that sets out an AMP has been issued for an accessibility related matter, the Agency may, upon request by a regulated entity, enter into a compliance agreement subject to terms that the Agency considers appropriate for the purpose of ensuring the entity's compliance with its legal obligations. The terms may include a provision for the deposit of reasonable security as guarantee that the person will comply with the agreement and may provide for the reduction, in whole or in part, of the amount of the penalty.

Under the Canada Transportation Act, a DEO has the authority to issue an AMP when the DEO believes that a violation has been committed. This policy constitutes a guideline for the DEO who has the ultimate discretion in determining the amount of the AMP.

Note that violations of certain legislative or regulatory provisions are handled on a case-by-case basis, and could result in the issuance of higher AMPs for first and subsequent violations than described above.

1. DEO receives information about potential non-compliance Information may be received from:
   • external sources (e.g. a third party, such as a competitor or a client);
   • internal sources (e.g. licencing)
   • another government department or agency; or
   • the DEO's own observations.
2. DEO analyses information and completes preliminary investigation form, steps include: (1-3 days depending on number of instances to be verified)
   • Identifying elements of the file
   • Determining if violation is a Designated Provision (AMP)
   • Reviewing internal databases
   • Reviewing open-source information
   • Verifying statute of limitation has not expired (1 year from date of alleged violation)

**If indicators of non-compliance present

3. Preliminary Investigation form is sent to Enforcement Manager for approval.
4. Targeted Investigation is opened in CMS
5. Investigation Phase
   • Gathering of Evidence: ( minimum 2 weeks but can take much longer depending on number of possible violations and amount/type of supporting evidence required)
     • DEO sends formal requests for information from suspected violator, other Government departments, witnesses, etc.
   • Analysing of Evidence: ( depending on the file, anywhere from few days to several of weeks)
     • DEO must review received information to ascertain whether it can establish on a balance of probabilities that a violation occurred.
     • This includes ensuring that information has been obtained that fulfils each element of the violation. (See table 1 for example)
     • This also includes gathering evidence to counter potential defence of due diligence
     • DEO takes into consideration previous case-law/agency decisions precedents. (For example the meaning of "air service" was articulated in Agency Decision No. 390-A-2013)

*Table 1: Example of "Elements of the Violation" for Section 57 CTA

**If evidence/analysis support violation

6. DEO prepares Investigation Package and submits to Enforcement Manager for review/approval. Investigation Package includes: (1-3 days)
   • Investigation Report
   • Appendices
   • Calculation of AMP which takes into account:
     • minimum/maximum penalty set out in CTA policy
     • Takes into account aggravating/mitigating factors (+/- 10% per factor)
   • Draft NOV

**If approved by Enforcement Manager

7. Enforcement Manager forwards Investigation Package to Legal Services for review/recommendation. ( depends on legal workload and the complexity of the file)
8. DEO signs NOV and sends to responsible party (overall the minimum time it take to complete an investigation is about a month)
9. Responsible party has 30 days to make payment of request TATC review.

Q. The US DOT has issued millions of dollars in fines to carriers to enforce regulations – why hasn't the CTA?

• The US DOT has issued $7.2 million in civil penalties related to Refunds during the pandemic – this represents almost 75% of all civil penalties issued during this time. The CTA did not obtain the authority to enforce refunds until last September, 2022.
• It is also important to note that the U.S. civil penalty and Canadian administrative monetary penalty (AMP) schemes are fundamentally different:
  • Civil penalties are issued in the US in large part so that passengers are provided remedies (compensation, refunds) by airlines, as unlike the CTA in Canada, the DOT does not adjudicate individual passenger complaints. Typically, the DOT will only undertake an enforcement action if they have evidence of systematic violations, or a single or a few egregious violations.
  • In the US, civil penalties, or a portion thereof, negotiated with the airline can be suspended and would only become due if the airline commits similar violations within a set time. The CTA does not have this authority.

Background Context on DOT's Penalty Agreement with Air Canada Respecting Refunds

The below case is an example of the application of the DOT's civil penalty scheme and describes the steps taken in their case against Air Canada respecting refunds. This describes how the DOT initially proposed a $25,550,000 fine against Air Canada, and how this was subsequently reduced in a negotiated settlement with Air Canada to $4,500,000; and then reduced to a payment of $2,000,000, in part due to a credit Air Canada received for refunds that it provided to passengers.

Outline of Case:

In response to the nearly 6000 complaints received by the US DOT's Office of Aviation Consumer Protection (OACP) about Air Canada respecting refunds, the OACP attorney alleged that there are 5,110 violations against the airline. Air Canaa had asserted that they were not required to provide refunds in cases where flights are cancelled due to the COVID-19 pandemic. The OACP had notified the carrier multiple times throughout 2020 and 2021 that the carrier's stance on the matter "lacks merit". Air Canada refused to change its policy until April 13, 2021, and would not come to terms on a consent order (i.e. a negotiated settlement) with the OACP. The OACP asserted that without a cease and desist order the airline may revert it's policies back to not providing refunds. Given the lack of an enforcement consent order, the OACP had filed on June 15, 2021 a complaint with an administrative law judge to hear the matter.

In this case the OACP attorney commenced enforcement actions against Air Canada. The OACP was seeking a cease and desist order with respect to not providing refunds and a civil penalty of $25,500,000. In respect to the amount it is noted the following was stated by the OACP attorney in the enforcement complaint:

For purposes of this Complaint, and in order to provide adequate notice of its exposure to potential civil penalties at this early stage, OACP conservatively estimates that Air Canada has committed a minimum of 5,110 violations of section 41712. These passengers waited anywhere from 5 months to 13 months to receive refunds.

Because 49 U.S.C. 46301 and 14 CFR Part 383 authorize a maximum civil penalty of $34,184 for each failure to provide a refund in violation of section 41712 between July 31, 2019, and January 1, 2021, OACP estimates Air Canada’s potential exposure to civil penalties is at least $174,680,240 without taking into account that each day is a continuing violation. (5,110 x $34,184 = $174,680,240).

OACP seeks a civil penalty amount that considers consumer harm, the scale of the violations, Air Canada’s knowledge and intent, and deterrent effect. In recognition of all of the circumstances, OACP views an appropriate civil penalty for each failure to provide a prompt refund in violation of 49 U.S.C. 41712 and 14 CFR 259.5, to be $5,000 per violation, which OACP views as high enough to have a deterrent effect. Using this formula, OACP is seeking a civil penalty of $25,550,000 (based on $5,000 times 5,110 violations).

On November 22, 2021, the OACP and Air Canada filed a Joint Motion for Approval of Proposed Settlement Agreement, which included the parties’ signed Settlement Agreement as an attachment which had the following statement:

Air Canada agrees to the terms of the proposed Settlement Agreement to avoid protracted litigation, as it focuses together with all stakeholders on rebuilding itself and doing its part to support the recovery of the airline industry. Accordingly, this agreement is being entered into for settlement purposes only and does not constitute any admission whatsoever by Air Canada of any violation of any statute, law, or regulation including as alleged, or the truth of any facts alleged during this proceeding (which are expressly denied).

The Settlement Agreement would dispose of all pending issues in this case. Pursuant to 14 C.F.R. § 302.417(a), the parties “may agree to settle all or some of the issues in an enforcement proceeding at any time before a final decision is issued.” Further, “the Administrative Law Judge shall approve the proposed settlement, as submitted, if it appears to be in the public interest.”

Air Canada - Order And Settlement Agreement (PDF, 510 KB)

As part of the settlement, Air Canada had to pay or be credited the agreed $4,500,000 in compromise of all civil penalties that might have been assessed for violations alleged by the Department. Of this amount,

1. $1,000,000 shall be due and payable within 30 days of the service date of the order approving this Settlement Agreement;
2. $1,000,000 shall be due and payable within 12 months of the service date of the order approving this Settlement Agreement; and
3. $2,500,000 shall be credited to Air Canada upon the service date of the order approving this agreement in consideration of refunds that it provided to passengers with non-refundable tickets for flights to or from the U.S. who chose not to travel and were not entitled to refunds under U.S. law so long as Air Canada was not reimbursed for these funds by the Government of Canada

Comparison of US and Canadian Air Passenger Protection Legislation and Regulations

Within the US legislative and regulatory regime, carriers are required to address similar issues found within the APPR and ATR including:

• minimum standards and compensation for denied boarding;
• contingency plans for lengthy tarmac delays;
• customer service plans that address minimum standards for issues such as refunds (including cancellations outside the carrier's control) and communicating delays, cancellations and diversions;
• domestic baggage liability (carrier must have a max liability of $3,800 USD per passenger or higher);
• advertising the total price that a consumer must pay to purchase a ticket.
• tariff and the terms in the contracts of carriage
• minimum standards for the carriage of musical instruments

The US does not have comprehensive rules on rerouting, minimum standards of treatment, compensation for inconvenience for flight delays and cancellations, or comprehensive rules on the seating of children (they have issued "best practices" guidelines respecting seating of children). See: Code of Federal Regulations at Title 14/ Chapter II / Subchapter A.

With respect to Refunds, during the pandemic, the US DOT issued enforcement notices (April 3, 2020 and May 12, 2020) indicating that refund obligations for delays and cancellations "…[do] not cease when the flight disruptions are outside of the carrier’s control." In contrast, the APPR was only recently amended to include refunds for flight disruptions outside carrier's control.

The DOT is currently working on new consumer protection rules for air passengers.

Comparison of Roles: US DOT and CTA

The US DOT's Office of Aviation Consumer Protection (OACP) has responsibilities similar to the CTA. OACP's compliance and enforcement activities include addressing unfair and deceptive practices, unfair competition by carriers and travel agents, deceptive airline advertising, and violations of rules concerning denied boarding compensation, ticket refunds, baggage liability requirements.

Enforcement Action Under OACP

When OACP has evidence of systematic violations, or a single or a few egregious violations, it will take enforcement action. It will first attempt to negotiate with the regulated entity and establish a Consent Order making sure consumers are made whole and assessing a civil penalty that is high enough to deter that entity and others from similar violations. If the regulated entity and OACP are unable to reach agreement on the terms of a consent Order, OACP will seek resolution of the matter by filing a formal complaint with the Department’s Office of Hearings for a decision by an Administrative Law Judge (ALJ).

Consent Orders^{Note 3 Note 4}

OACP generally takes enforcement action when it sees a pattern or practice of violations—for example, when a company has a problematic policy, multiple consumers file complaints on similar issues, or an incident affects many consumers all at once—or if a single or a few particularly serious violations occur. If enforcement action is warranted, OACP primarily resolves these cases by negotiating with an alleged violator and reaching a settlement agreement in the form of a Consent Order.

The Consent Order is an order directing the alleged violator to cease and desist from the problematic practice. In many cases, the consent order will assess an administrative civil penalty which is remedial in nature and is intended to bring about compliance and to deter similar violations by the same violator or other entities. Consent Orders also help OACP to ensure that consumers’ needs are addressed promptly. For example, if appropriate and to ensure future compliance, OACP may agree to settlements that include a suspended civil penalty amount, which would only become due if the regulated entity commits similar violations within a set time of the order, and/or a credit for costs expended by the violator to do things that benefit consumers beyond what is required by the law. OACP has often permitted up to half the assessed civil penalty to be suspended in tarmac delay cases, for example, to further encourage carriers to prevent future tarmac delays.

OACP has permitted carriers to offset a portion of expenditures on systems that reduced wait times for passengers to obtain wheelchair assistance, or reduced the length of tarmac delays, to time periods below legal time limits. All settlements are made public through OACP’s website. If OACP and a regulated entity cannot reach a satisfactory resolution of an enforcement matter using the consent Order process, then OACP may choose to pursue such violations through the initiation of a formal enforcement proceeding before an ALJ as described below.

In comparison, when the Agency has dealt with numerous complaints on a similar issue, the Agency has initiated inquiries such as the Air Transat Inquiry 2017, Sunwing Inquiry 2018 and Inquiry into complaints regarding reasons for flight delays or cancellations 2020. DEOs utilized the findings of the Air Transat and Sunwing inquiries in their subsequent investigations and issued AMPs for $295,000 and $419,000, respectively.

Enforcement Proceedings in Front of the Department’s Office of Hearings

These enforcement actions are begun by OACP filing a formal complaint with the Department’s Office of Hearings, which will assign the matter to an ALJ for adjudication using trial-type proceedings. These enforcement actions likely would seek substantial civil penalties and include cease and desist provisions as well as other remedial relief deemed appropriate by OACP.

What is the Role of an Administrative Law Judge in Comparison to CTA?

Administrative law judges, who work for the DOT's Office of Hearings, are similar to CTA members, the primary process difference is the parties to the proceedings. At the CTA in an adjudication, both the passenger and the carrier provide the pleadings while CTA staff facilitate the process and Agency members render a decision. In the OACP process they file a complaint to the administrative law judge and the parties to these proceedings are the carrier and the OACP. The OACP acts in the public interest, utilizing the complaints from passengers as their evidence.

Warning Letters

If enforcement action through an order or an administrative proceeding before an ALJ is not warranted, for example, if the violating entity took sufficient corrective action prior to OACP learning about the violation, OACP may exercise its discretion and send a warning letter to the violating entity. The letter places the violator on notice that OACP is aware of the violation and may pursue enforcement action if similar violations occur in the future

Civil Penalty or AMP Amounts

Like the CTA, the OACP considers several factors in determining the penalty amounts. They may seek civil penalties in the amount of $37,377 per violation for all entities, other than small business or individuals, to which a general penalty amount of $1,644 per violation applies (higher penalties are issued for anti-discrimination, essential air services and unfair and deceptive practices provisions.). In comparison, when determining the amount of an AMP, CTA DEOs also consider several factors per the policy and assigned severity levels of provisions.

US DOT Messaging Respecting Compliance Enforcement

On January 3, 2023, the United States Department of Transportation (US DOT) published a "Notice Regarding Investigatory And Enforcement Policies And Procedures". This notice provides insight into the enforcement actions the US DOT's Office of Aviation Consumer Protection (OACP) can undertake and its current approach and messaging to reaffirm its commitment to 'vigorously' enforce the law and protect consumers.

(For information on OACP's complaint process see Appendix A)

Appendix A - OACP's Complaint Process

How does the US DOT handle air passenger complaints?

The OACP is the body within the US DOT that receives air travel complaints. The OACP's dispute resolution process differs from the CTA in that it facilitates complaints and follows up with airlines to try to bring them into compliance willingly. Unlike the CTA, the OACP does not mediate or adjudicate complaints.

The OACP recommends that the first course of action should be for a passenger to complain to the airline and try to conclude the issue with them. If their issue is not rectified, the passenger may complain to the OACP. At that point the OACP Analyst will forward the complaint to the airline, review their response and analyze the case to determine if there is a violation. With the assistance of an attorney, the OACP Analyst will then prepare a written assessment, summarizing each party’s position and offering an assessment. This assessment may trigger an airline response.

If the carrier does not act on the complaint or on the OACP assessment, the OACP Analyst will continue to contact the carrier in an effort to resolve the complaint. Typically, for individual complaints, the airline will comply with the OACP assessment, if not, the passenger can pursue the matter through small claims court. The matter could be escalated to an OACP attorney who is responsible for commencing enforcement action. Typically this would be the case if it is related to an egregious violation(s). Complaints also be escalated for enforcement action if they relate to systemic issues, or issues that affect many passengers (e.g. tarmac delays).

In addition to its complaints facilitation and enforcement actions, the OACP also has a "name and shame" function in that they produce monthly Air Travel Consumer Reports which list various airline details including the number and type of complaints as well as various statistics about the airline such as flight delays, cancellations, denied boarding, mishandled baggage and so on.

Appendix B

(from Enforcement Order 2021-2-8, served on February 18, 2021 on JetBlue Airways)

4. We order JetBlue Airways Corporation and its successors and assigns to cease and desist from further violations of 14 CFR 259.4 and 49 U.S.C. §§ 41712 and 42301;
5. We assess JetBlue Airways Corporation $60,000 in compromise of civil penalties that might otherwise be assessed for the violations found in ordering paragraphs 2 and 3, above. Of this amount,
   1. $22,500 shall be due and payable as follows:
      1. $11,250 shall be due and payable within 120 days of the service date of this order; and
      2. $11,250 shall be due and payable within 180 days of the service date
      of this order;
   2. $15,000 shall be credited to JetBlue Airways Corporation for travel vouchers provided to passengers on board flight 746 and passengers who had to wait additional time for wheelchair assistance to deplane flight 326;
   3. The remaining $22,500 shall become due and payable if, within one year of the service date of this order, JetBlue Airways Corporation, violates this order’s cease and desist or payment provisions, in which case the entire unpaid amount shall become due and payable immediately and JetBlue Airways Corporation may be subject to additional enforcement action for failure to comply with this order.

General

• In general, there is a high level of adherence to the requirements of the Agency's accessibility regulations.
• We know this because we have been implementing a proactive verification strategy since the beginning of the calendar year (2022).
• In cases where travellers believe they encounter a barrier to their mobility, they file complaints with the Agency. We receive between 100 and 200 accessibility complaints a year, a small fraction of the complaints we receive each year.
• When we receive an accessibility-related complaint, we ensure that such complaints move to the front of the line and are prioritized. As a result, there is no backlog with respect to accessibility complaints.
• Even in the absence of a complaint, when we are made aware of an egregious incident where there may be a violation of the regulations, we ask our enforcement team to look into the incident to obtain more information about what happened.
• More generally, we continue to raise with industry the importance of not just following the regulations, but of ensuring that a culture of respect and ensuring the dignity of persons with disabilities is imbued in all their staff and contractors, in all aspects of their work.

Mobility Aids

• Under both the ATPDR (large transportation service providers) and Part VII of the Air Transportation Regulations (ATR) (small-air carriers), airlines are required to provide assistance with respect to mobility aids, such as passenger transfers, and to quickly repair, replace or reimburse damage to mobility aids.
• Even in the absence of a complaint, when we are made aware of an egregious incident that could be a violation of the regulations, we ask our enforcement team to look into the incident to obtain more information about what happened.
• More generally, the Agency continues to work with partners internationally to improve the handling of mobility aids. For example, with Transport Canada, we commissioned a study by the National Research Council on the safe storage and transportation of mobility aids in the cargo holds of aircraft; this study has become an important input to the work of the new IATA Action Group on Mobility Aids, which seeks to harmonize and improve industry best practices with respect to the handling of mobility aids.

Service Animals

• The ATPDR requires that trained service dogs be accepted for travel by airlines.
• It is clear that dogs can be trained as service animals and that there are many organizations that provide the appropriate training.
• We have received some complaints from travellers regarding acceptance of other animals, including emotional support animals by airlines.

We have sought an expert opinion regarding the transportation of emotional support animals, which we have posted on our website, and are conducting consultations on this subject.

The Agency has the discretionary power to extend all or part of a decision respecting a complaint related to flight delay, flight cancellation or denial of boarding to other passengers of the same flight, as it considers appropriate.

This power is found in section 67.4 of the Canada Transportation Act (for domestic services) and subsection 113.1(3) of the Air Transportation Regulations (for international services).

Potential questions – TRAN Committee

Q1: Has the Agency used these powers?

A1: No decisions applying these powers have been issued to date, but the Agency has incorporated changes to its dispute adjudication process to allow their use, including through a formal notification made to airlines and complainants of the Agency's intention to use them, where appropriate.

Q2: Why hasn't the Agency used these powers since 2019?

A2: Agency orders extending a decision to other passengers of the same flight are made as decisions respecting complaints in adjudication are issued. Since the implementation of changes to the Agency's dispute adjudication process, the Agency has observed a trend of disputes being settled by the parties via the Agency's alternative dispute resolution services or on their own. In these cases where no formal decision is issued, no findings related to the flight disruption can be extended to other passengers.

In addition, these orders are to be made in the context of the adjudication of flight disruption cases. Shortly after the coming into force of the Air Passenger Protection Regulations in 2019, the COVID-19 pandemic occurred and the Agency received a wave of complaints related to the issue of refunds. This exposed a gap in Canada's air passenger protection framework, which the Agency committed to closing once given the appropriate regulatory authority. It developed and published the Regulations Amending the APPR, while focusing its efforts on resolving the unprecedented number of refund-related complaints.

The trend in complaints has since shifted to flight disruptions and resulting entitlements. For example, this past summer, we saw a new wave of complaints related to the issue of crew shortages and compensation for inconvenience. The Agency acted quickly and issued important interpretative decisions clarifying when crew shortages may be considered within the airline's control. In addition to issuing decisions that provide guidance for future flight disruption cases, the Agency has incorporated changes to its dispute adjudication process to allow the use of the Agency's powers to apply its decisions to other passengers, including through a formal notification made to airlines and complainants of the Agency's intention to use them, where appropriate.

Complaints involving flight disruptions will continue to be dealt with under this established process and decisions on these cases may include such an order, as appropriate.

Q3: Do these powers only apply to complaints at the adjudication stage?

A3: The Agency may extend all or part of a decision respecting a complaint in adjudication to other passengers of the same flight whether or not they have filed a complaint with the Agency and regardless of what stage of the dispute resolution process (facilitation, mediation or adjudication) each complaint is at.

Depending on the circumstances, this could include ordering an airline to provide other passengers with a copy of the Agency’s decision and to inform them:

• that they could be eligible to receive compensation for inconvenience and/or reimbursement of expenses incurred as a result of the flight disruption;
• of the deadline for filing a request for compensation for passengers who have not yet filed such a request; and/or
• that passengers who were refused compensation by the airline can ask it to reassess their request for compensation.

This said, whether compensation for inconvenience is owed or not, and what amount is due to each passenger, depends on the individual situation of each passenger. This includes factors such as whether the passenger was delayed at destination or not and for how long, which vary depending on the individual itinerary of each passenger. For example, passengers with different final destinations may not experience the same disruption to their travel. In all cases, passengers who seek compensation for inconvenience must first make a claim with the airline within one year of the disruption.

Sunwing

Q. How many Sunwing complaints did the CTA receive for December?

Passengers must first contact the airlines and wait at least 30 days for a response before filing a complaint with the CTA. As a result, we will not know at this time the extent of complaints received related to Sunwing flights in December 2022.

Sunwing and compliance

Q. Will the CTA or Transport Canada investigate the Sunwing situation? Will fines be given to the airline?

A. The Canadian Transportation Agency's Designated Enforcement Officers (DEOs) are currently gathering information and conducting compliance activities as they relate to the requirements of the Air Passenger Protection Regulations (APPR) (such as the requirements to provide assistance and alternate travel arrangements). For example, an investigation into communication issues reported by passengers has been initiated, specifically into possible non-compliance with section 13 of the APPR that requires airlines to provide information to passengers when a delay or cancellation occurs.

The CTA's DEOs will continue to analyze the information being gathered and will take appropriate actions as necessary. More information on how, and when, the CTA takes enforcement actions can be found in the CTA’s Compliance and Enforcement Policy.

Q. What repercussions will the airline face for leaving passengers stranded for more than a week? Passengers have been calling for Sunwing’s license to be revoked – is this a possible course of action?

A. Under the APPR, small airlines such as Sunwing have different obligations for making alternate travel arrangements depending on whether the cancellation or delay of three hours or more is within or outside the airline's control:

• In situations outside the airline's control (i.e. weather conditions that make it impossible to safely operate the aircraft), small airlines must book the passenger on their next available flight, or on the flight of an airline with which it has a commercial agreement. The flight must depart within 48 hours after the departure time indicated on the passenger’s original ticket. If the airline cannot provide a reservation on a flight that departs within this 48-hour period, the airline must, at the passenger’s choice, provide a refund or alternate travel arrangements on their next available flight or on the flight of an airline with which it has a commercial agreement.
• In situations within the airline's control (i.e. a commercial decision to consolidate or cancel flights because of low demand), or within the airline's control but required for safety purposes (i.e. a mechanical malfunction), small airlines must book the passenger on the next available flight operated by them or an airline with which they have a commercial agreement. If the alternate travel arrangements do not meet a passenger’s needs, the passenger is entitled to a refund.

In general, the CTA has two primary tools for ensuring passenger protection under the APPR. Its dispute resolution process and its compliance monitoring and enforcement activities.

As it relates to the Sunwing disruptions, and as previously mentioned, the Agency's DEOs are currently gathering information and will take the appropriate enforcement actions.

Further, outside of these enforcement actions, passengers who believe that an airline has failed to comply with its obligations and have first filed a complaint with their airline and have not received a response within 30 days or are unsatisfied with the response, may file a complaint with the CTA. If the Agency finds that the airline has failed to properly apply the terms and conditions that apply to the passenger's ticket, it can order the airline to take the corrective measures that it considers appropriate or to pay expenses a passenger may have incurred. This ensures passengers receive what they are entitled to, whether it is compensation for inconvenience, refunds, or compensation for expenses they have incurred as a result of the airline's failure to comply with the APPR.

We would also note the following for passengers with lost, damaged or delayed baggage:

• Passengers with damaged baggage must submit a claim in writing to the airline within 7 days after receiving their damaged baggage;
• Passengers with delayed baggage travelling on international itineraries must submit a claim in writing to the airline within 21 days after receiving their delayed baggage;
• Passengers with delayed baggage travelling on domestic itineraries should submit a claim in writing as soon as possible and no later than the time limit found in the terms and conditions of the airline;
• Passengers with lost baggage (not returned within 21 days) should submit a claim in writing to the airline as soon as possible.

Q. Will the CTA be issuing AMPs or talking other corrective actions towards the airline?

Administrative Monetary Penalties (AMPs) may be issued if there are violations, which remains to be determined.

Q. What obligations can the CTA investigate on? Is there a list of those?

CTA may investigate all applicable APPR provisions if non compliance is suspected.

YVR disruptions

Q. Is the CTA investigating?

The Canadian Transportation Agency (CTA) is monitoring the situation related to tarmac delays at YVR, which involves several airlines, and will take appropriate actions as necessary.

The CTA has Designated Enforcement Officers on site gathering information, which involves several airlines, and will take appropriate actions as necessary.

We are continuing to gather information to ensure airlines comply with legislative and regulatory provisions.

CTA Compliance and enforcement

Q. What is the CTA doing to ensure airlines comply with the regulations?

The CTA has many tools to advance its regulatory mandate with respect to passenger protection.

The APPR sets out minimum obligations of airlines to passengers when flights are disrupted. This can include things such as rebooking a passenger on a flight, providing meals and accommodation, or providing compensation for inconvenience depending on the reason for the flight disruption.

When a passenger makes a complaint and the CTA finds that the air carrier has failed to meet its APPR obligations, the CTA has the power to order the airline to provide these things, and to pay other expenses that a passenger may have incurred. For this reason, the main way we provide consumer protection for air passengers is by resolving their complaints against airlines. This tool allows passengers to receive what they are entitled to, whether it is compensation for inconvenience, refunds, or compensation for expenses they have incurred as a result of the airline's failure to comply with the APPR.

Additional compliance tools, including seven designated enforcement officers, are utilized strategically based on a series of factors including severity and risk. They include proactive monitoring and enforcement of the regulations, and issuing notices of violation (NoV) with administrative monetary penalties (AMP), where required. Unlike the process for the resolution of complaints, however, enforcement actions do not result in any compensation to individual passengers.

As per the CTA's Compliance and Enforcement Policy, Designated Enforcement Officers address non-compliance by applying a gradual approach, using both informal and formal enforcement measures. They undertake a thorough analysis to select the enforcement instrument that will be the most effective in causing the entity to return to or achieve compliance and prevent recurrence.

The CTA believes that these actions, combined, are the best way to both ensure that industry and passengers understand their respective rights and obligations, and to achieve compliance with the regulations.

Since the coming into force of the APPR in 2019, the CTA has issued 80 Cautionary Notices, and 26 Notices of Violation with Administrative Monetary Penalties (AMPs) ($184,800.00) relating to the APPR. Note, since January 2022, the CTA has issued 13 Notices of Violation with AMPs which total $98,850.00 to 8 different carriers relating to the APPR. More detailed information on enforcement actions taken by the CTA can be consulted on our website.

Q. What is the amount of the fines given by the Agency to air carriers to date, compared to last year?

The amount of monetary penalties issued to air carriers for this fiscal year is $169,750.

The amount for the last fiscal year, which ended on March 31, 2022, was $253,975.

However, it is important to note that the figures for last year include two penalties issued in the rail sector (CN: $90,475 and CP: $119,250).

The amount for last year in the air sector was $44,250.

Wait times and efficiencies to address the backlog

Q. What is the current backlog of air travel complaints at the CTA?

We have over 33,000 complaints pending as of January 4.

In general, the CTA deals with older cases first, but in order to deal with cases as quickly as possible, when cases are identified that have interpretative value that would support not only the resolution of a particular dispute, but also the informal resolution of a number of other disputes, these cases are given priority.

Currently, the wait time between when a case is submitted and when it is reviewed is over 18 months.

Q. What is the CTA doing to improve wait times of air travel complaints?

We have undertaken a comprehensive review of our complaint processes and continuously monitor operational data to ensure we have an understanding of the workload coming in and our processing capacity.

We are examining solutions to find efficiencies in our processes. For example, we were able to streamline the intake of complaints and reduce incomplete and inaccurate applications from 50% of all applications received to 10%, which results in less administrative back and forth and shorter wait times for applicants.

We anticipate that this ongoing review will continue to yield opportunities for process efficiencies and automation. Our data-driven focus has already allowed us to quickly review cases informally and formally through the batching of cases, by finding cases that have a common factor such as flight number, travel issue, and processing cases in groups.

In addition, we have also found ways to streamline our adjudication process and reduce our administrative burden, substantially reducing the time to issue an adjudication decision.

Most cases are resolved informally through facilitation or mediation (97%), with only a small percentage decided through arbitration or formal adjudication (3%).

We have been proactively offering information to air passengers filing with the CTA and publishing information online about wait times and their case status with a view to help them understand our dispute resolution process.

Q. Will the agency extend decisions made for an individual complaint to other passengers on the same flight for complaints related to December flights?

The CTA has already incorporated changes to its dispute adjudication process to allow the use of these powers, including through a formal notification made to airlines and complainants of the CTA's intention to use them, where appropriate.

CTA orders extending a decision to other passengers on the same flights will be made as the CTA adjudicates flight disruption cases and decisions are issued. Complaints involving the December flight disruptions will be dealt with under that process and decisions on these case may include such an order, as appropriate.

Depending on the circumstances, this could include ordering an airline to provide the other passengers with a copy of the Agency’s decision and to inform them:

• that they could be eligible to receive compensation for inconvenience and/or reimbursement of expenses incurred as a result of the flight disruption;
• of the deadline for filing a request for compensation for passengers who have not yet filed such a request; and/or
• that passengers who were refused compensation by the airline can ask it to reassess their request for compensation.

This said, whether compensation for inconvenience is owed or not, and what amount is due to each passenger, depends on the individual situation of each passenger. This includes factors such as whether the passenger was delayed at destination or not and for how long, which vary depending on the individual itinerary of each passenger.

For example, passengers on the same connecting flight, but with different final destinations may not experience the same disruption to their travel. In all cases, passengers who seek compensation for inconvenience must first make a claim with the airline within one year of the disruption.

Q. The CTA's website states a 20-day service standard for facilitating air travel complaints. Does this mean the agency aims to facilitate or mediate at least 80% of complaints within 20 days in normal circumstances?

The CTA set for itself the goal of facilitating cases in 20 business days or less, from the date a case is received, under normal circumstances. We typically address facilitation cases in less than 20 days once an agent is assigned the case.

Recourse with the CTA if a refund or offer is accepted by PAX.

Q. If passengers receive a refund from the airline does this mean they can no longer file a complaint with the CTA?

Accepting a refund does not automatically relieve the airline from the obligation to pay compensation in addition to a full or partial refund to a passenger.

CTA resources and dispute resolution

Q. The plan indicates that in this fiscal year, the agency head count would shrink from 319 FTEs to 240 FTEs, as a variety of funding sunsetted, with that reduction coming from the dispute resolution services. I am wondering if that reduction took place. (Jan. 9, 2023 – National Post)

The forecasted reduction in FTEs was affecting mostly the Dispute Resolution Program. The reduction did not take place since in Budget 2022, the CTA received a renewal of its sunsetting funds and was able to maintain an FTE level comparable to 2021-22.

Currently, the total CTA headcount is 320 and for dispute resolution is 94.

Q. How many people at CTA process the consumer complaints? (Nov. 25, 2022 – Toronto Star)

The Canadian Transportation Agency's (CTA) Dispute Resolution Program has 73 permanent full time equivalent employees (FTEs).

In addition to its regular budget, in 2022-23, the CTA was provided with one year additional funding to hire 79 temporary FTEs to work on Air Travel Complaints, within the Dispute Resolution Program.

The Dispute Resolution program provides dispute resolution services, upon application, for air, rail, marine and accessibility disputes within the CTA's jurisdiction. It does this using a range of approaches from relatively informal facilitation and mediation to more formal arbitration and adjudication.

CTA and Independence

Q. What measures does the CTA take to prevent regulatory capture?

The CTA is created by the Canada Transportation Act (Act). Like other administrative agencies, the CTA is part of the executive branch of government and its purpose is to implement government policy. The CTA has a duty to be independent and impartial to the extent determined by the laws voted by Parliament.

Under the Act, the CTA has two roles. It acts as a quasi-judicial tribunal when deciding proceedings such as air travel or rail complaints. It acts as a regulatory body when making regulations; publishing guidelines; issuing determinations and regulatory authorities (such as permits, licences, and rail certificates of fitness); and enforcing compliance with the law. The CTA must exercise all of its powers, in both roles, to fulfil the mandate given to it by Parliament.

To perform some of its regulatory functions and achieve results in connection with its mandate, the CTA must engage with government officials, the industries it regulates, as well as consumer and disability rights organizations. Engagement is required by law or government policies when the CTA develops certain regulatory instruments. In other situations, engagement allows the CTA to, for example, further its expertise in transportation matters, improve operational efficiencies, and keep informed about transportation trends and issues. Engagement also allows the CTA to remain current and relevant and to competently advance its mandate, in accordance with the National Transportation Policy (set out in section 5 of the Act).

The composition and structure given to the CTA under the Act include several safeguards to ensure the CTA is not controlled or inappropriately influenced by the government or others. The CTA has also adopted additional safeguards to maintain its independence and impartiality. Key safeguards include:

Rules regarding the selection and appointment of CTA members by the Governor in Council, along with the Act's provisions regarding members' tenure.

Conflict of interest prohibitions under the Act and other statutes.

Requirements governing the conduct of members and employees, set out in the code of conduct and values and ethics codes, and embedded in various CTA practices.

CTA rules, guidelines, and practices for complaint and determination cases, which ensure a fair process. CTA members only decide cases based on material that is filed in the record of proceedings and on which parties have had an opportunity to comment, to prevent improper external influence.

CTA practices when engaging with government officials, industry stakeholders, and consumer and disability rights organizations, which is that the merits of specific cases not be discussed.

With these safeguards in place, the CTA fulfills its administrative decision-making function in an independent and impartial manner while engaging appropriately on a regular basis with government officials, regulated industry stakeholders, and consumer and disability rights organizations, in the proper discharge of its regulatory functions.

A Statement regarding the independence of the Canadian Transportation Agency has recently been published where you can read more about how the CTA fulfils its dual role within the boundaries of the law, including how it preserves the level of independence the Act requires and ensures that parties' right to an impartial decision-maker is respected, while legitimately engaging with external parties for different purposes to achieve results, to maintain its expertise with respect to the transportation industry and to discharge its mandate.

Complaints per 100 Flights dashboard publication (Dec. 19, 2022)

CTA news release

CTA publishes a new dashboard providing the number of complaints it receives per 100 flights flown by airlines

The Canadian Transportation Agency (CTA) today announced the publication of new data to provide Canadians with additional information about the air travel sector. The data shows the number of air travel complaints submitted to the CTA per 100 flights operated by Canadian and foreign airlines.

The complaints data is compiled by the CTA and will be updated on a quarterly basis.

The tables include:

• air travel complaint data submitted during 3-month time periods
• airlines that operated a minimum of 100 flights to/from/within Canada during each time period
• airlines with an average of 1 or more complaints per 100 flights

Background

• The complaint data is based on the information submitted by passengers and may not have been reviewed by the CTA at the time of publishing
• The data is based on the number of flights by airline and does not reflect the number of passengers per flight or the size of the aircraft
• The data used for this dashboard is based on all of the air travel complaints submitted to the CTA; the numbers do not imply whether or not an airline actually met its regulatory requirements
• Most complaints (97%) are resolved informally through facilitation or mediation; other complaints move to a formal adjudication process
• Airlines identified in the complaint may change based on the information supplied by the passenger and the airline during the complaint review process
• Complaints related to accessibility are not included in these tables
• The number of flights operated per airline during the time period is provided by a third party (Cirium)

Complaints Receiver Over the Holidays

Q. How many complaints did the CTA receive over the Holidays?

From December 20, 2022, to January 9, 2023, the Canadian Transportation Agency received over 2,800 air travel complaints.

We had over 31,000 complaints pending as of December 20. In general, the CTA deals with older cases first, but in order to deal with cases as quickly as possible, when cases are identified that have interpretative value that would support not only the resolution of a particular dispute, but also the informal resolution of a number of other disputes, these cases are given priority.

Small vs. Large Airline Definitions

Q. In fall/winter of 2022, would Sunwing still technically be considered a "small" airline if one didn't take into consideration the previous two years?

The Air Passenger Protection Regulations define a "large carrier" as a carrier that has transported a worldwide total of two million passengers or more during each of the two preceding years. All other air carriers are considered "small".

At the beginning of 2020, Sunwing Airlines was considered a large air carrier as they had transported a minimum of two million passengers in 2018 and 2019. In 2020 and 2021, due to the COVID-19 pandemic, Sunwing did not transport more than two million passengers in each of those years. Therefore, Sunwing would be considered a small carrier under the APPR for the 2022 and 2023 calendar years.

Q. According to the CTA definition of a small airline, the criteria is based on the previous two years. Does that mean that even if Sunwing flew at or near full capacity in 2022 and again in 2023, it won't be considered a "large" airline until 2024?

Sunwing could regain large air carrier status under the APPR in 2024, if their passenger volumes meet the two million passengers transported requirement for each of the 2022 and 2023 calendar years.

Recent FCA decision and impact on CTA regulations

Q. What is the impact of the federal court of appeal ruling on baggage claims? Is it still correct to say that under the APPR, passengers can claim up to $2,300 for delayed baggage?

Under the Montreal Convention, for international travel, passengers can claim up to $2,300 for delayed, damaged and lost baggage.

This was also the case under the APPR, for domestic travel, until the Court invalidated the requirement for delayed luggage. As a result of this decision, passengers claims for delayed luggage on domestic flights have to be answered according to the terms and conditions set out in the airline's tariff applicable to the ticket purchased by the passenger (the tariff is the contract of transport between the air carrier and the passenger). For lost or damaged luggage, the Court decision does not change anything – passengers continue to be entitled to claim up to 2300$ as the APPR continues to apply.

In all cases, passengers should file a claim with the airline when their baggage is delayed, damaged or lost. For delayed baggage on domestic flights, the Agency will look at the airline's tariff to decide what passengers are entitled to. For claims about lost and damaged luggage on domestic flights, the Agency will continue to apply the APPR.

Section 5 (National Transportation Policy)

• The Agency has the primary responsibility for administering much of the Canada Transportation Act.
• Section 5 of the Act sets out the National Transportation Policy.

National Transportation Policy

Marginal note: Declaration

5 It is declared that a competitive, economic and efficient national transportation system that meets the highest practicable safety and security standards and contributes to a sustainable environment and makes the best use of all modes of transportation at the lowest total cost is essential to serve the needs of its users, advance the well-being of Canadians and enable competitiveness and economic growth in both urban and rural areas throughout Canada. Those objectives are most likely to be achieved when

• (a) competition and market forces, both within and among the various modes of transportation, are the prime agents in providing viable and effective transportation services;
• (b) regulation and strategic public intervention are used to achieve economic, safety, security, environmental or social outcomes that cannot be achieved satisfactorily by competition and market forces and do not unduly favour, or reduce the inherent advantages of, any particular mode of transportation;
• (c) rates and conditions do not constitute an undue obstacle to the movement of traffic within Canada or to the export of goods from Canada;
• (d) the transportation system is accessible without undue obstacle to the mobility of all persons;
• (d.1) the transportation system is accessible without barriers to persons with disabilities; and
• (e) governments and the private sector work together for an integrated transportation system.

Agency mandate

• The Agency contributes to the achievement of the National Transportation Policy and also fulfills other mandates given to it in legislation.

Three mandates

• First, we help ensure that the national transportation system runs efficiently and smoothly in the interests of all Canadians.
• Second, we protect the human right of persons with disabilities to an accessible transportation network.
• Third, we provide consumer protection for air passengers.
• The regulations we make and enforce, and the dispute resolution services we offer, are our key tools for fulfilling these mandates.
• As an added tool, we provide information, such as guides on the rights and responsibilities of transportation providers and users.

Mandate evolution

• The Agency's mandates are not static, because the legislation governing them can and does evolve over time.
• For example, Canada Transportation Act amendments passed in 2018 established our enhanced consumer protection mandate for airline passengers.
• These were the amendments that required us to develop an "air passenger bill of rights" – what became the Air Passenger Protection Regulations.
• The Agency adapts as needed to new mandates, including by setting new policy objectives for its regulatory agenda and by adjusting staff and resources.

• For the first time in Canada, the Air Passenger Protection Regulations (APPR) established common requirements for air passenger consumer protection that have to be respected by all airlines.
• This includes a requirement for airlines to offer passengers a rebooking or a refund for flight disruptions within airline control or within airline control but required for safety.
• Published in CG2 on May 22, 2019, the APPR came into force in two stages:
  • On July 15, 2019, airlines were required to meet new obligations concerning communication, denied boarding, tarmac delays, baggage, and the transportation of musical instruments.
  • On December 15, 2019, the remaining obligations on flight delays and cancellations (including the payment of compensation as required), and the seating of children came into effect.
• The Regulations Amending the Air Passenger Protection Regulations came into effect on September 8, 2022:
  • These amendments include new refund obligations for flight delay or cancelations outside the airline's control where they can't rebook a passenger within a reasonable time.
• APPR created more consistent passenger rights by establishing minimum obligations related to:
  • the communication of key information,
  • flight disruptions (including flight delays and cancellations, and denied boarding),
  • tarmac delays,
  • the seating of children,
  • lost of damaged baggage, and,
  • the transportation of musical instruments.
• APPR apply to all flights to, from, and within Canada (including connecting flights).
• When communicating key information, airlines must inform passengers of their rights in a timely, clear and accessible way:
  • For all disruptions, airlines must notify passengers of a flight disruption as soon as possible and provide regular status updates.
  • They must also advise passengers:
    • Of the reason for the disruption;
    • Of the assistance (standard of treatment) they are entitled to, and provide that assistance;
    • When they may be eligible to receive compensation that may apply; and,
    • How to take recourse against the airline if they think they haven't been treated appropriately.
• For flight disruptions (including flight delays and cancellations, and denied boarding) APPR obligations depend on the level of control an airline has over the situation:
  • For situations within airline control, passengers are entitled to alternate travel arrangements, assistance, and compensation;
  • For situations within airline control but required for safety, passengers are entitled to alternate travel arrangements and assistance; and,
  • For situations outside airline control, passengers are entitled to alternate travel arrangements only (or a refund if the passenger can't be rebooked within a reasonable time).
• When providing alternate travel arrangements all airlines must complete the passenger's itinerary as soon as possible:
  • When a flight disruption is within airline control (including when required for safety):
    • The airline must rebook the passenger on their next available flight or on that of a partner airline.
    • If the alternate arrangements do not meet the passenger's travel needs, the airline must provide a refund.
  • When a flight disruption is outside airline control:
    • If the airline cannot provide the passenger with a confirmed reservation on a flight leaving within 48 hours of the departure time on the passenger's original ticket, the airline will be required to, at the passenger's choice:
      • Provide a refund; or,
      • Rebook passengers who do not wish to be refunded on the next available flight.
• Assistance must be provided to passengers when delays or cancellations within the airline’s control (including related to safety) are communicated to passengers less than 12 hours before departure, free of charge. This assistance could include, for example:
  • Food and drink;
  • Access to a means of communication; and,
  • Hotel accommodations (if delay is expected to extend overnight) and transportation to and from these accommodations.
• Airlines must provide compensation for the inconvenience of flight cancellations and flight delays within their control and not related to safety, and if the airline notified you of the disruption 14 days or less in advance.
• Compensation is paid based on the length of the passenger's delay, which is determined by your arrival time at the final destination on your ticket.
• If you are flying on a large airline and the length of the delay is:
  • from 3 to 6 hours, your compensation is $400;
  • from 6 to 9 hours, your compensation is $700; and,
  • 9 hours or more, your compensation is $1000.
• If you are flying on a small airline and the length of the delay is:
  • from 3 to 6 hours, your compensation is $125;
  • from 6 to 9 hours, your compensation is $250; and,
  • 9 hours or more, your compensation is $500.
• For flight delays and cancellations, a passenger has one year to make a compensation claim with the airline. The airline has 30 days to respond to a claim.
• For instances of denied boarding, airlines must pay compensation no later than within 48 hours.
• During tarmac delays, airlines must:
  • Provide assistance (including, access to working lavatories, proper ventilation and heating or cooling, food and drink, and the ability to communicate with people outside the plane free of charge, if feasible); and,
  • Allow disembarkation (Canadian airport only) once the delay has reached 3 hours.
    Note: At the 3-hour mark, if take-off time is imminent^{Endnote 5} the airline is allowed one opportunity to remain on the tarmac, if they are able to continue to provide assistance.
• For the seating of children, airlines must take steps to seat children under 14 years of age near their parent, guardian or tutor at no extra charge – the allowable distance depends on the age of the child.
• In the case of lost or damaged baggage, airlines must apply the Montreal Convention to domestic travel (liable up to approximately $2,100):
  • Airlines area also to reimburse passengers any baggage fees paid.
• For the transportation of musical instruments, airlines must establish terms and conditions on the acceptance of musical instruments.

Decision No. 107-C-A-2022

Background

The Air Passenger Protection Regulations (APPR) fully came into force at the end of 2019. The regulations provide for clearer and more consistent air passenger rights for all passenger flights to, from and within Canada by imposing certain minimum carrier requirements in air travel – including assistance (standards of treatment) and, in some situations, compensation for passengers. The APPR were made by the Agency in accordance with the legislative framework provided in the Canada Transportation Act.

The framework identified three categories for flight disruptions (i.e., flight delays and cancellations, and denied boarding) and established varying entitlements, depending on how much control air carriers have on the situation:

• Situation within carrier control – communication of key information, compensation, standards of treatment, and alternate travel arrangements;
• Situation within carrier control but required for safety purposes – communication of key information, standards of treatment, and alternate travel arrangements;
• Situation outside carrier control – communication of key information and alternate travel arrangements only.

In addition, in December 2021, the Minister of Transport directed the CTA to establish new obligations for carriers to provide refunds when there is a flight cancellation, or a lengthy delay, for reasons outside of the carrier's control and the carrier cannot complete the passenger's itinerary within a reasonable time. This addressed a gap in the above framework. These obligations come into effect September 8, 2022.

The EU's air passenger regulations (EC261/2004) has a much simpler framework when it comes to determining air carrier obligations and passenger entitlements in the event of a flight disruption. EC261 requires that in the event of a flight cancellation or delay (depending on the duration), air carriers complete the passenger's itinerary or provide a refund, and provide assistance (right to care) and compensation

• Only if the carrier can prove the disruption was caused by "extraordinary circumstances", which could not have been avoided even if all reasonable measures had been taken, would they not be required to pay compensation to their passengers. In those situations, they must continue to provide them with the standards of treatment and ensure that they can complete their itinerary or provide them with a refund.

Comparison of carrier obligations for flight disruptions under the APPR and EC261

Proposed amendments to EC261/2004

In 2013, the EC put forth a proposal that aimed to improve air carrier compliance with EC261/2004 by clarifying key principles and implicit passenger rights that have given rise to many disputes between carriers and passengers. This includes further defining and expanding "extraordinary circumstances" and taking measures that aim to take into account the financial capacities of air carriers including:

• Lengthening the time before passengers are entitled to compensation. Compensation entitlements for delays at arrival would be begin at 5 hours delay for all journeys within the EU and extra-EU flights <3500km, 9 hours delay for extra-EU journeys between 3500km-6000km, and 12 hours delay for extra-EU journeys >6000km.
• Limiting the right to accommodation during extraordinary circumstances. Air carriers would be allowed to limit the right to accommodation to three nights with a cap of 100 EUR per night per passenger.
• Carve outs for small/regional carriers so that they are not compelled to provide accommodations if they meet certain criteria (e.g., flight distance <250km and size of the aircraft with less than 80 seats)
• Allowing air carriers the right to seek redress from any third party which contributed to the event triggering compensation or other obligations
• The amendments would also provide a non-exhaustive list of "extraordinary circumstances":
  • natural disasters rendering impossible the safe operation of the flight;
  • technical problems which are not inherent in the normal operation of the aircraft, such as the identification of a defect during the flight operation concerned and which prevents the normal continuation of the operation; or a hidden manufacturing defect revealed by the manufacturer or a competent authority and which impinges on flight safety;
  • security risks, acts of sabotage or terrorism rendering impossible the safe operation of the flight;
  • life-threatening health risks or medical emergencies necessitating the interruption or deviation of the flight concerned;
  • air traffic management restrictions or closure of airspace or an airport;
  • meteorological conditions incompatible with flight safety; and
  • labour disputes at the operating air carrier or at essential service providers such as airports and Air Navigation Service Providers.
• The amendments would also provide clarification that the following circumstances would not be considered as "extraordinary":
  • technical problems inherent in the normal operation of the aircraft, such as a problem identified during the routine maintenance or during the pre-flight check of the aircraft or which arises due to failure to correctly carry out such maintenance or pre-flight check; and
  • unavailability of flight crew or cabin crew (unless caused by labour disputes).
• The proposed amendments set out new obligations for carriers towards their passengers when their aircraft is delayed on the tarmac, in particular, carriers must provide free of charge access to toilet facilities and drinking water and ensure adequate heating or cooling of the passenger cabin once the delay exceeds one hour, and the right to disembark after five hours.

• Application of the Air Passenger Protection Regulations: A Guide
• Baggage Requirements for Domestic Services: A Guide
• Communicating key information to passengers: A guide
• Denied Boarding: A guide
• Types and categories of flight disruption: A guide
• Seating of Children with an Accompanying Passenger on an Airplane: A Guide
• Tarmac Delay Standards of Treatment and Disembarkation: A guide

Cases Received and Processed by Week

Cases in Progress by Month

CTA Complaints

Volumes:

The CTA continues to receive a record number of travel complaints – almost 28,000 so far this fiscal year, with the busy winter travel season still ahead of us. This is almost 4 times as much as five years ago (7650 received).

• This includes more than almost 6,000 complaints received in the month of August alone.

We currently have 33,000 active air travel complaints, and we suspect that this will grow in the aftermath of the holiday travel disruptions. 80% of our cases have been received since April 1, 2022, 18% were from the FY 2021-22, 2% from FY 2020-21.

Efficiencies:

Despite the continued high volumes, we have been able to find efficiencies to improve our processes:

• In adjudication, once pleadings are opened, cases are getting resolved more quickly. 70% of our cases are being issued within our service standard of 85 days this year, which is a significant improvement over last year (50%).
  • In fact, this year, our average processing time is 79 business days, compared to 103 business days last year.
• While facilitation wait times continue to be long, once a facilitator is assigned to the case, the process takes an average of 20 business days. We've made several improvements to reduce incomplete applications and streamline the process and we're pleased to see that this year we are on track to facilitate 2,500 more cases than last year.
  • In fact, overall we are on track to process about 11,000 cases in 2022-23, when five years ago, we were processing 5,000. There will be variation in the volume of cases that we can process year to year, depending on complexity and resource levels. While we were able to process about 15, 000 cases in 2021-22, the cases processed this year were somewhat more complex.

Background Statistics – Complaints received

Background Statistics - Complaints Processed

*projected

Background Statistics - Service Standards:

Accessibility complaints received

• The CTA published a Statement regarding its independence in September 2022.
• The Statement explains key legal concepts that apply to administrative agencies like the CTA:
  • "Impartiality" – concerns the state of mind or attitude of a decision-maker in a specific case.
  • "Independence" – concerns an organization's structure and relationship to other parts of the executive branch of government and others like regulated entities.
  • "Independence" is a spectrum.
  • Administrative agencies are part of the executive branch, not the judiciary. Their purpose is to implement government policy. They are not the same place as courts on the spectrum for this reason.
  • Statutes voted by Parliament determine the standard of independence applicable to each agency, through provisions establishing the mandate, the structure and composition of that agency.
• The Statement describes the CTA's mandate in the Canada Transportation Act.
  • The CTA has a dual role as regulatory body and quasi-judicial decision-maker.
  • Both roles are equally important and the CTA must exercise all of its powers under both roles to fulfill its mandate.
  • It acts as a regulatory body when making regulations; publishing guidelines; issuing determinations and regulatory authorities (permits, licences, and rail certificates of fitness); and enforcing compliance with the law.
    • In this role, the CTA must engage or consult with stakeholders to achieve results, improve operational efficiencies, maintain its expertise, or comply with legal requirements.
  • It acts as a quasi-judicial tribunal when deciding proceedings such as air travel or rail complaints.
    • In this role, the CTA adopts conduct that preserves its impartiality and keeps it shielded from external influence.
• The Statement describes safeguards that ensure the CTA maintains the independence and impartiality required by law, including:
  • Rules regarding the selection and appointment of CTA members by the Governor in Council, along with the Act's provisions regarding members' tenure.
  • Conflict of interest prohibitions under the Act and other statutes.
  • Requirements governing the conduct of members and employees, set out in the Code of Conduct for Members of the Agency and values and ethics codes, and embedded in various CTA practices.
  • CTA rules, guidelines, and practices for complaint and determination cases, which ensure a fair process. CTA members only decide cases based on material that is filed in the record of proceedings and on which parties have had an opportunity to comment, to prevent improper external influence.
  • CTA practices when engaging with government officials, industry stakeholders, and consumer and disability rights organizations, which is that the merits of specific cases not be discussed.

Background

• On March 25, 2020, the CTA posted the Statement on Vouchers on its website.
• It was posted in the first weeks of the COVID-19 pandemic, in a context of sudden, worldwide flight disruptions and of much uncertainty.
• At the time time, there were no CTA regulations in place requiring refunds for flight disruptions outside the control of airlines.
• Nor was there any signal at that time that financial agreements between the Government of Canada and airlines, which included the requirement to provide passenger refunds, would be offered.
• Passenger entitlements varied from ailrine to airline and depended on the ticket purchased by passengers. There was a risk that many passengers that had purchased non-refundable tickets might end up getting nothing for cancelled or delayed flights.
• The Statement therefore indicated that an appropriate approach in these circumstances could be for air carriers to provide vouchers to passengers for future travel.
• The Statement was not a decision of the CTA on any specific case; it did not affect the rights of passengers to make a complaint if they believe they were owed a refund under the tariff of a particular airline.
• The Statement indicated that passengers's specific situation brought before the Agency would be examined on its merits. Passengers could, and have, filed complaints about their entitlements and these are heard by the CTA on their merits.
• The Statement is being challenged in the Federal Court of Appeal. No hearing date has been scheduled as the record is still not complete.
• There have been important developments affecting air travel since the Statement was made.
  • Minister of Transport issued a directive to make the refund regulation, which provides for the possibility of refunds for flight disruptions outside airline control.
  • The CTA refund regulation has been made and came into force on September 8, 2022.

• Through the years, several news stories have been published about children who were travelling alone that had experienced a flight disruption and were left stranded at airports without any assistance from the air carrier on which they were travelling.
• For example in January 2022 an airline left a 14-year-old at Toronto airport alone after cancelling her flight (story).
• These children, due to their ages at the time of travel, were either:
  • travelling under the supervision of an air carrier's unaccompanied minor program, or,
  • they were considered to be adults for the purposes of transportation and had no services available to them other than what would have been afforded to a regular adult passenger.
• A few Canadian citizens have also written to the Agency to express their concerns about these incidents. They have indicated that the government should ensure the safety of children travelling alone.
• Although air carriers do include in their tariffs certain terms and conditions in respect of the carriage of children and unaccompanied minors, including those who are travelling under the air carriers’ supervision, they typically do not touch on children/minors experiencing flight disruptions when travelling alone;
• On an international level, certain amendments have been made to the Annex 9 of the Convention on International Aviation (also known as the Chicago Convention) to incorporate certain limited provisions regarding unaccompanied minors.
• The International Air Transport Association (IATA) has also conducted studies on the matter, and published its recommended best practices regarding minors.
• The Agency is currently conducting a study to determine:
  • if a problem exists for children travelling alone,
  • if there are adequate policies in place by air carriers to properly serve children travelling alone and
  • assess what, if anything, can or should be done based on the authorities that the Agency has at its disposal.
• The next step is to solicit input from key air carriers via a questionnaire and face to face meetings, in order to gather information on the matter.

Background information

Interline

• A relationship between airlines which allows one airline to sell services to a customer that are being provided by another airline to sell itineraries that they would otherwise not be able to serve alone;
• Interline occurs within many different commercial agreements which include individual interline agreements, codeshare agreements, air alliances and joint ventures (see below);
• The International Air Transportation Association (IATA) has long maintained a system for supporting and implementing interline arrangements between airlines and has model agreements which can be adopted.

Individual interline agreements

• Most basic form of partnership that allows passengers to book through itineraries on two (or more) airlines with less hassle than booking each one separately and carriers agree to publish a fare from the origin to the final destination and then internally divide the revenue between them;
• Usually, if two airlines are interlining, they will agree to handle the ticketing, check-in and baggage for each other’s passengers;
• For example: Whitehorse to Edmonton on Air North flight #4N123 and then Edmonton to Toronto on Air Canada flight #AC321.

Codeshare

• An arrangement in which two or more airlines publish and market the same flight under their own airline designator code^{Footnote 6} and flight number (the "airline flight code") as part of their published timetable or schedule;
• Typically, a flight is operated by one airline (the "operating carrier") while seats are sold for the flight by all cooperating airlines(the "marketing carrier(s)") using their own designator and flight number;
• This arrangement has a greater degree of commercial integration between the airlines than that offered via a standard interline agreement;
• For example: Ottawa to Toronto on Lufthansa flight #LH4987 (flight actually operated by Air Canada flight #AC987) and then Toronto to Frankfurt on Lufthansa flight #LH4654 (flight actually operated by Air Canada flight #AC654).

Airline Alliances

• Partnerships between or among airlines in which they share resources, pick up or extend partner routes and even offer the ability to earn and redeem miles through each others’ rewards programs. There are three major airline alliances: SkyTeam, Star Alliance and Oneworld. Each has different partner airlines.

Joint Ventures

• A joint venture is a complex commercial agreement where the airlines involved seek to operate a single business in relation to the relevant markets by coordinating their schedules and sales activities to maximize revenue and profit for the overall business. The parties then share the revenues generated by the business in a way which is designed to ensure that it makes no financial difference to an airline joint venture partner whether a customer flies on its aircraft or that of the joint venture partner. This is sometimes referred to as the airlines being “metal neutral”;
• Often require government approval due to the potential removal of competition, public interest concerns and may be subject to financial requirements.
• For example, BA, Iberia, Finnair, Aer Lingus and American Airlines have been operating a transatlantic joint venture for many years. These airlines are all members of the Oneworld alliance.

Commercial Agreements (Interline, Code-share, Joint Ventures) and Tariffs

• No statutory provisions in the CTA or the ATR which require air carriers to enter into any type of commercial arrangement with other airlines;
• Commercial agreements and the details of such agreements are separate contracts which are only the subject to oversight in specific circumstances (for example mergers and acquisitions);
• The details of the various air carrier commercial agreements between different airlines are not included in a carrier’s tariffs^{Footnote 7};
• If two carriers have a commercial agreement in place, then each participating carrier's tariffs must reflect the fares, rates and charges any terms and conditions that will be applicable to the transportation of passengers or goods and which are offered to the public as a result of the agreements;
• For domestic services, if two air carriers are participating in any type of commercial agreement which produces a combined service between two points within Canada then these carriers should set out the fares under which this services will be sold and any terms and conditions that will apply to the transportation of passengers or goods that have been agreed upon by the cooperating air carriers in a commercial agreement. This can be achieved either through the carriers' individual tariffs applicable to the services they are providing or through a combined joint tariff if the carriers choose to establish such a tariff;
• For international services, similar to domestic tariff requirements but the ATR sets out specific provisions applicable to joint tolls and joint terms and conditions in tariffs and makes allowances for such tariffs. The Agency also has the authority to intervene to determine whether there has been an equitable division of revenue between carriers who are in a commercial agreement for any joint tolls they offer. The various bilateral air transport agreements (ATA) also contain provisions which indicate the circumstances under which air carriers can participate in various types of commercial agreements in conjunction with the international services that a particular carrier wishes to offer. The terms of the ATAs are administered by the Agency.

An example of a consumer protection situation where the Agency has exercised its authorities over interline air services offered using air carrier tariff obligations: the Agency established an approach to interline baggage rules and provided guidance to air carriers and their agents relating to interline baggage rules application. The approach clarifies to air carriers and ticket sellers, and informs the travelling public, how baggage rules should be applied (for both checked and unchecked baggage).

CTA Client Satisfaction 2021-2022

This report covers the period April 1, 2021, to March 31, 2022.

• Chair - Peter Schiefke (Liberal)
• Vice-Chair - Melissa Lantsman (Conservative)
• Vice-Chair - Xavier Barsalou-Duval (Bloc Québécois)
• Member - Taylor Bachrach (NPD)
• Member - Vance Badaway (Liberal)
• Member - George Chahal (Liberal)
• Member - Terry Dowdall (Conservative)
• Member - Angelo Iacono (Liberal)
• Member - Matt Jeneroux (Conservative)
• Member - Annie Koutrakis (Liberal)
• Member - Dan Muys (Conservative)
• Member - Churence Rogers (Liberal)

44^th Parliament

• Railway safety and the effects of railway operations on the surrounding communities in which they operate
  TRAN - May 2022

43^rd Parliament

• Emerging from the crisis: a study of the impact of the Covid-19 pandemic on the air transport sector
  TRAN - June 2021
• Main Estimates 2021-22
• Thursday, April 22, 2021 – Meeting 27
• Thursday, March 25, 2021 - Meeting 23

42^nd Parliament

• Main Estimates 2019-20
• Thursday, May 9, 2019 – Meeting 142
• Interim report on establishing a Canadian transportation and logistics strategy
  TRAN - February 2019
• Supplementary Estimates (A), 2018-19
• Tuesday, November 27, 2018 – Meeting 122
• Main Estimates 2018-19
• Wednesday, May 30, 2018 - Meeting 106
• Main Estimates 2017-18
• Tuesday, May 9, 2017 – Meeting 57
• Bill C-49, An Act to amend the Canada Transportation Act and other Acts respecting transportation and to make related and consequential amendments to other Acts
  TRAN - Adopted by the House on November 1, 2017
• Certain provisions of the Fair Rail for Grain Farmers Act
  TRAN - December 2016

Air Travel

• TRAN Meeting 67 - Monday, September 11, 2017
• TRAN Meeting 106 - Wednesday, May 30, 2018
• TRAN Meeting 8 - Tuesday, December 1, 2020
• TRAN Meeting 27 - Friday, August 19, 2022
• TRAN Meeting 31 - Monday, October 3, 2022
• TRAN meeting 42 - Monday, November 28, 2022

Accessibility

• HUMA Meeting 116 - Monday, October 22, 2018
• SENATE Wednesday, April 10, 2019

Rail

• TRAN Meeting 67 - Monday, September 11, 2017
• TRAN Meeting 38 - Tuesday, June 15, 2021