Strengthening Air Passenger Protection in Canada

Backgrounder

Introduction

The Air Passenger Protection Regulations (APPR) came into force in 2019 with the objective of providing consistent air passenger rights by imposing minimum requirements on airlines in several key areas. These include: how passengers are treated when flight disruptions occur, when they should be compensated for inconveniences experienced and how and what airlines should communicate to them.

In implementing the APPR it has become increasingly apparent that some areas of the legislation and regulations have proven to be unclear, leading to significant room for differing interpretations - particularly regarding the characterization of flight disruptions.

Issues with the rebooking and refund obligations, as well as with airlines' communications requirements, have also been noted.

On June 22, 2023, the Budget Implementation Act, 2023 (BIA) was passed by Parliament. It modifies the Canada Transportation Act (the Act) to clarify, simplify and strengthen the Canadian air passenger protection regime. Below is an outline of important changes in the Act that impact the way the CTA delivers its mandate and the proposed regulatory changes the CTA will undertake as a result of the legislative amendments.

Air Passenger Protection Regulations

Proposed changes to the APPR are intended to clarify, simplify and strengthen consumer protection for air passengers.

Under the existing APPR, passenger entitlements depend on how a flight disruption is categorized (within airline control, within airline control but required for safety or outside airline control), making it difficult for passengers and airlines to know what passengers are entitled to, and making the regulations difficult to enforce.

The amendments to the Act passed by Parliament eliminated the three flight disruption categories and require airlines to provide compensation for inconvenience to passengers when there is a flight disruption, unless there are exceptional circumstances, which the CTA will define by regulation. The amendments also put the burden on airlines to prove the situation is an exceptional circumstance.

Changes proposed by the CTA to the APPR would establish passenger entitlements that apply in the case of all flight disruptions, and any entitlements that may apply in exceptional circumstances.

A new regulatory provision would also be created requiring airlines to provide a refund to passengers if they cancel a flight reservation because the Government of Canada issues a travel advisory for a given country.

The new regulations will apply to flights departing after the changes to the APPR come into force. Cases submitted to the CTA for which the flight date occurs before the coming into force of the new APPR provisions will be subject to the APPR provisions that were in force on the date of flight departure and the applicable conditions of the purchased ticket.

The first step in the process for changing the APPR was for the CTA to invite stakeholders and the public to provide feedback on our Consultation Paper. The deadline for providing input in this first round of consultations was August 10, 2023.

The CTA is currently analyzing the input received and will publish its proposed draft regulations in the Canada Gazette-Part 1 later this fall. This will launch an official consultation period where stakeholders and the public will be invited to provide their input on the draft regulations before they are finalized.

Complaints Resolution Office

The amendments to the Act require the CTA to change how it processes air travel complaints, resulting in a simpler, clearer, faster and more cost-effective process.

On September 30, 2023, the existing CTA process for air travel complaints changed from a court-like approach to a more streamlined claims resolution process.

The new process will apply to all air travel complaints already received by the CTA, except those that are currently being considered in adjudication.

Information about the complaints resolution process can be consulted on our website.

Cost Recovery

The amendments to the Act require the CTA to recover from airlines some, or all, of the costs of dealing with air travel complaints through the air passenger complaint resolution process.

Every time there is an eligible air passenger complaint, the airline that is the subject of the complaint will be charged an amount to recover some or all of the costs of the CTA processing that complaint.

In the coming months, the CTA will be consulting stakeholders on a proposal for cost recovery. Cost recovery is expected to be implemented in 2024.

Other New Measures to Support Passenger Protection

Changes to the Act also provide the CTA with new tools to support consumer protection for air passengers. These include:

• Increasing the maximum administrative monetary penalties the CTA can impose from $25,000 to $250,000 for violations of the APPR;
• Clarifying that each day that a contravention of the APPR continues can be considered a new violation;
• Allowing the CTA up to three years to issue a notice of violation (rather than just one year) for APPR violations;
• Allowing the CTA to establish compliance agreements with airlines contravening the APPR in order to promote improved ongoing compliance; and
• Providing the CTA the authority to issue binding interpretive guidelines to clarify interpretation issues that may arise in the implementation of the APPR.

The amended Act also places new obligations on airlines to:

• Establish a process for dealing with passenger claims and provide its decision to the passenger within 30 days of receiving a complaint; and
• Post the versions of their domestic tariff from at least the past three years on their website (international tariffs are already filed with the CTA).