This article has been updated as of 8:15 a.m. on Oct. 30, 2019.
In a statement, ACTA says it's been aggressively conducting a lobbying campaign directed at the Ontario government.
According to ACTA, the purpose of the campaign is to relieve Ontario travel agencies of the "many financial and administrative burdens that they face as a result of the Travel Industry Act and the Travel Industry Compensation Fund."
In the fall of 2018, ACTA and CATO formed an industry coalition and hired a lobbyist to guide their efforts and deliver their concerns to the government. A team of ACTA and CATO senior leaders have been actively meeting with Ontario Government officials since early 2019.
“The message to every government official has been clear – the status quo in Ontario is not effective or sustainable and places an unfair burden on Ontario travel companies, as well as offering very little meaningful protection to Ontario consumers,” said Wendy Paradis, President, ACTA. “We need to adopt a funding model similar to Quebec for funding consumer protection.”
The lobbying efforts will continue now that the Ontario government is back in session and ACTA wants all Ontario registrants to get involved.
Speaking with PAX, Paradis said that the Quebec model is completely funded by the consumer, the beneficiary of The Compensation Fund.
"Because millions of travel consumers have paid a small amount into The Fund over time for every travel booking, The Quebec Fund has grown very quickly to over $150 million dollars," Paradis said. "In fact, The Quebec Fund is so well funded, it is no longer necessary for consumers to pay any fees into the fund at all. In the event of a large travel business failure – Quebec consumers would be well protected by The Quebec Consumer Compensation Fund."
Seeking industry support
As part of this ongoing campaign, ACTA is asking industry members to support a letter writing campaign to their MPPs and the government. Letter templates can be obtained online from the home page at acta.ca or by clicking here.
"The Travel Industry ACTA has been “up for review” since 2016 and there has been delay after delay, and no real action on the file that we can see," Paradis told PAX.
In late 2018, ACTA formed a joint association committee with CATO and hired a professional lobbyist to help navigate the new government.
"Since early 2019 we’ve had over a dozen meetings with government officials – including several MPPs, as well as politicians and policy personnel in the Ministry of Government and Consumer Services, Ministry of Finance, Ministry of Economic Development and Trade, and the Premier’s Office to build support for our cause," Paradis told PAX.
“All travel agency owners should be paying attention and we need their help at the grassroots level. In our meetings over the past several months, it became clear that many MPPs have never heard of TICO or the Ontario Travel Compensation Fund. We need to get relief for travel agencies from this archaic and inadequate piece of legislation. Reform is essential or travel agencies will just continue paying more and more,” said Paradis.
The current Compensation fund was designed in the 1970s when consumers paid by cash or cheque, before the internet and e-commerce. Today, well over 90 per cent of travel agency transactions are completed using a credit card, making travel agency bookings a much lower risk.
In a statement, ACTA said that "it is an unfair financial and administrative burden on Ontario travel businesses, creating a disadvantage for Ontario travel companies and making them uncompetitive in a global market."
ACTA says that the Fund currently sits at more than $23 million but an actuarial study conducted for TICO says the Fund should be at $50 million.
According to ACTA, the Compensation Fund does not work for consumers. The organization says that "it is confusing, has many limitations and delays before paying and is the payer of last resort. TICO has a policy of forcing the consumer to first request a charge-back if payment was made by credit card, or requesting reimbursement from a travel insurance policy. If the failure is a large one, there is a cap on total payout per failure, so consumers only get a partial payment."
ACTA wants Ontario to move to a consumer-pay model similar to the one in Quebec, in the hopes that it will provide meaningful protection to consumers in the event of travel company failures.
ACTA is also seeking to reduce the burden of excessive financial reporting. Currently, many Ontario travel businesses are required to submit a costly audited financial statement on an annual basis to TICO. ACTA has strongly recommended to the Ontario Government that the requirement of paying for and submitting audited financial statements is an expensive and unnecessary burden on many Ontario Travel Agencies.
After a recent and extensive review of Canada’s financial criteria by IATA, review engagements were deemed the highest level of reporting necessary for Canadian travel agencies. ACTA is strongly urging the Ontario Government follow suit.
ACTA also supports the recommendation proposed by TICO that other less expensive forms of internally prepared financial statements be considered for small travel businesses with Ontario gross sales of under $2M.
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