Ontario to table anti-scalper bot legislation

TORONTO — Ontario is seeking to strengthen consumer protection rules around home warranties, ticket sales, real estate practices, and travel services in an omnibus bill introduced Thursday.

Changes to ticket selling laws include making so-called scalper bots illegal. The bots purchase a large number of tickets online for a concert, show, or other event, then resell them at a large profit.

But those bots often operate from out of the country, which would make enforcement difficult, Attorney General Yasir Naqvi admitted, so the bill also aims to undercut both profit incentive and resale abilities.

“There’s no one way, or silver bullet, of dealing with bots,” he said.

The bill would ban tickets from being resold at more than 50 per cent of the face value and make it illegal to knowingly resell tickets that were purchased by bots.

“Companies like Ticketmaster and Stubhub, which pretty much control about 80 per cent of the market in Ontario, they invest a fair bit of money in dealing with bots because it’s a nuisance for them as well,” Naqvi said.

Ticket sellers would also have to display an itemized list of all fees, taxes and service charges, and resellers would have to disclose the face value of the ticket. Those rules, as well as the resale markup limit, provide an easy point of enforcement, Naqvi said.

“We took a very pragmatic view as to how can we create laws within our own jurisdiction that create a level playing field and rules that we can actually practically enforce,” he said.

Catherine Moore, a University of Toronto adjunct professor of music technology, said the scalper bot ban itself sounds difficult to implement.

“If the person who is behind or the company and the people who are behind the bots are not based in Ontario or are not based even in Canada, how can you prosecute them, how can you fine them?” she said.

Ministry of Government and Consumer Services agents would get the power to do inspections and lay fines against violators of the act. Companies themselves would also get the power to sue other companies for losses resulting from the use of bots.

Both Ontario’s opposition parties said they support the bill, but New Democrat Jennifer French said the Liberal government created a loophole for scalper bots in the first place, “so it absolutely is incumbent on them to fix it.”

The government changed the Ticket Speculation Act in 2015 to make it legal to resell tickets above their original face value.

Ticketmaster did not return a request for comment, but StubHub said it supports the legislation, though it is wary of the cap on resale prices. It told the government during consultations that more regulatory burdens on the ticket market will drive sales off mainstream platforms that provide certain protections.

“Price caps displace tickets from secure sources, therefore exposing fans to higher instances of fraud, less transparency around fees, non-existent customer service and reduced ability for enforcement,” Laura Dooley, the company’s senior manager of government affairs, said in a statement.

The omnibus bill would also separate the provider of Ontario’s warranty program for new homes from the body regulating new home builders. It would also make the dispute resolution process easier for homeowners who discover a problem in their new home’s construction.

A 2015 review found fault with Tarion Warranty Corp.’s complex structure and over-arching mandate — it has overseen nearly all facets of the home building sector for the past 40 years — with both builders and homeowners questioning Tarion’s objectivity.

At the time of the review Tarion said all of the review’s recommendations, which included splitting its responsibilities, would weaken consumer protection, increase costs and create barriers to entry for builders. On Thursday, it said it will support the province on a “smooth transition” and delivery of its plan.

The bill also tackles the issue of double ending, in which a real estate agent represents both a buyer and a seller in a transaction, though specifics are being left to regulations. Ontario Real Estate Association CEO Tim Hudak said it will allow for greater transparency and consumer protection.

Real estate sellers, brokers and brokerages would also be subject to stiffer fines if they violate a code of ethics, up from $25,000 to $50,000 and $100,000 for brokerages.

In the travel industry, the bill would create new rules for out-of-province travel sellers and set new registration requirements for travel salespeople.

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