Jurisdiction of the Agency

Fares on "monopoly" routes

A route is considered to be a monopoly when it is served by only one carrier without any competition from other carriers. The Agency's jurisdiction over pricing on air services within Canada is not limited to "monopoly routes". There may be other situations where a route within Canada is served by only one carrier and its affiliates or by more than one carrier and the Agency is of the opinion that these other services do not provide a reasonable alternative.

In these cases, the Agency may look at the situation affecting that route. If it finds that competition is limited as laid out in the Canada Transportation Act, then the Agency may review the passenger fares and cargo rates on that route to determine whether or not they are unreasonable.

If the Agency finds, upon complaint, that a fare, rate or price increase offered on a route in Canada served by only one carrier is unreasonable, it may order the fare or rate to be reduced or order the carrier to refund persons who were over-charged, if this is practicable. The Agency may also take action where it determines that an inadequate range of fares or rates has been offered. For example, if the Agency finds that a carrier is offering a discount fare on a route served by more than one carrier and is not offering a discount fare on a similar route served by only one carrier, the Agency may order the carrier to publish and apply a discount fare on the route served by only one carrier.

Terms and conditions of carriage

An air carrier must set out its terms and conditions of carriage in its tariff. "Terms and conditions of carriage" cover a number of things such as: limits or restrictions on the weight or size of baggage, compensation for lost, delayed or damaged luggage, compensation for denied boarding (bumping), and the carrier's rules concerning the carriage of persons with disabilities or minors.

The air carrier's tariff contains all its fares, rates, charges, and terms and conditions of carriage. A ticket is proof of payment and only contains some of the information that appears in a tariff.

The Agency can deal with two types of complaints regarding terms and conditions of carriage. These complaints can concern travel within Canada, or international travel to or from Canada provided by Canadian or foreign carriers.

• The first type of complaint concerns whether a carrier has applied the terms and conditions of carriage as published in its tariff. If the Agency finds that a carrier failed to apply its terms and conditions of carriage, the carrier will be ordered to do so. Under some circumstances, it could also be ordered to compensate the passengers or shippers. The Agency could also fine the carrier if the Agency found that the carrier had not applied its tariff.

• The second type of complaint concerns carriers who have unreasonable or unduly discriminatory terms or conditions of carriage in their tariffs, such as the refusal to provide compensation for lost baggage. If the Agency finds that a term or condition of carriage is unreasonable or unduly discriminatory, it may disallow the term or condition in question, and may substitute a different term or condition in its place.

The Agency may also investigate complaints involving fares, rates and charges on international routes, and complaints that a carrier has failed to respect the provisions of the international air transportation agreement applicable to the flight in question.

Discontinuance or Reduction of Service to a Community

When carriers plan to discontinue or reduce certain domestic services, the Canada Transportation Act specifies that they must meet certain notice requirements. Notice is required in three situations:

• When a carrier proposes to discontinue service that would result in only one or no carriers serving a point;

• When a carrier proposes to reduce the frequency of a service to less than one flight per week, which results in only one or no carriers providing service to that point at least once per week;

• When a carrier proposes to discontinue a year-round, non-stop, scheduled air service between two points in Canada that would result in major seating capacity reductions on that route.

If one of these situations arises, then the carrier must give the community or communities affected 120 days notice before the date it proposes to discontinue or reduce a service. For carriers who have served the point for less than one year, they are required to give 30 days notice. In addition, the carrier must provide elected officials of the community or communities affected an opportunity to discuss the impact of its proposal to discontinue or reduce service.

A carrier may apply to the Agency to have the notice period reduced.

If you believe that a carrier has not given proper notice as set out above, you may complain to the Agency. If the Agency finds that proper notice was not given, it may order the carrier to reinstate the service for up to 60 days if it is practicable to do so. The Agency may also fine a carrier that has failed to provide proper notice.

It should be noted that this process cannot prevent a carrier who has given proper notice from discontinuing its service.

Charter Carriers

Charter carriers and scheduled carriers operate differently and this results in a distinction in how the Agency's jurisdiction applies to them.

Carriers operating international charters are not able to sell the seats on their flights directly to the public in the way that scheduled carriers can. To buy seats for an international charter, a consumer must buy them through a travel agent or a tour operator. A tour operator often combines the flights with other elements of a vacation (such as hotels or ground transportation) to make a "package" to sell to the public. Tour operators can also sell just air travel ("air only").

The Agency's jurisdiction is limited to the air portion of the travel package. This will usually include the rules governing lost, delayed or damaged luggage, flight delays, refusal to transport (bumping), etc. The Agency will also try to resolve complaints regarding charter fares or other issues if you have already complained to the carrier and are dissatisfied with the carrier's response.

Complaints about the land portion of the package or services offered by the tour operator come under provincial and territorial jurisdiction and should be addressed to your provincial / territorial office dealing with consumer matters including travel.

The Agency has no jurisdiction over:

• the level or quality of service provided by tour operators or travel agents. This falls under provincial and territorial jurisdiction.

• anti-competitive or predatory behaviour by an air carrier. This comes under the jurisdiction of the Competition Bureau.

• terms or conditions of carriage or passenger fares or cargo rates if these are included in a confidential contract between the carrier and someone who has contracted for its services; this may include a wholesaler or a tour operator who has chartered or contracted for seats on board an aircraft and then re-sells the seats to the public.

• matters involving undertakings provided by Air Canada to the Minister of Transport regarding its merger with Canadian Airlines International.