Ontario pushes ahead with sweeping changes to ticket-scalping rules

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Ontario is rolling its proposed changes to event-ticket legislation into a larger consumer-protection bill that will attempt to widen the opportunities to enforce its new ticket rules, which will include a ban on ticket-scalping "bot" software and a maximum 50-per-cent markup on resold tickets.

Since scalpers and their software can work from anywhere, far from Ontario, a great deal of responsibility will fall to ticket-resale marketplaces that do operate in the province – such as StubHub and Ticketmaster's TM+ service – by making it illegal for them to knowingly facilitate the sale of a ticket using bots and to enforce the resale-price cap.

Since last year's emotional and widely scalped Tragically Hip tour, after frontman Gord Downie revealed a diagnosis of terminal brain cancer, the province has promised to make ticket buying and selling a fairer process. Tabled on Thursday afternoon by Consumer Services Minister Tracy MacCharles, the consumer-protection bill clarifies how some of the Liberals' ticketing goals would be enforced, but industry members and observers remain skeptical of how effective it might be.

"We remain concerned that capping resale prices will only serve to drive fans to dangerous online retailers," said Erin Benjamin, executive director of concert-industry association Music Canada Live. The 2016 Tragically Hip tour that provoked this legislation saw four million people try to buy about 200,000 tickets, she said. "Capping resale prices won't prohibit [scalping] activity."

Attorney-General Yasir Naqvi said in an interview that while prosecuting scalpers who use rapid-ticket-buying bot software could be difficult, the legislation, including price caps, is meant to block them in a roundabout way by enlisting the help of marketplaces such as StubHub.

Such companies would be consumers' first line of defence, effectively giving them the task of policing sellers who use bots and to stop them. Mr. Naqvi said Ticketmaster and StubHub represent about 80 per cent of Ontario's ticketing market and that "they do take their responsibility seriously." But, he continued, "We've put the onus on them, because we know we … can exercise jurisdiction over those companies."

The Ticket Sales Act would also require resellers to reveal their names and contact information when listing tickets, giving resale platforms the chance to take action against lawbreakers, including via lawsuit. Consumers would also be able to see if a ticket is being sold by an individual or company to help them decide if the seller is legitimate.

Primary ticket vendors such as Ticketmaster would also have to reveal how many tickets will be available to the general public for each event.

Consumer Protection Ontario would be empowered to handle ticketing complaints and to investigate various parties in the ticket-selling process, such as vendors and venues, and hand out penalties. Administrative fines would range as high as $10,000 per infraction. Breaking the law could lead to penalties as high as $50,000, or jail time for individuals, and up to $250,000 for corporations if there is a conviction.

While many of the consumer-protection details were announced with the Ticket Sales Act's framework in June, the move to wrap it into broader consumer-focused legislation is a signal from Queen's Park that enforcing its ticket laws is a top priority, Ms. MacCharles said on Thursday.

Stakeholders generally praised the Ticket Sales Act's transparency and anti-bot measures, but most were concerned that capping resale prices could drive scalpers to entice consumers to grey or black markets, rather than legitimate companies.

"This one-size-fits-all solution does not address the fundamental issue that resale [price capping] is great for some events and terrible for others," said Pascal Courty, a University of Victoria professor who studies ticketing economics.

In a statement, Laura Dooley, StubHub's senior manager of government relations, said price caps would expose fans to fraud, extra fees and poor customer service. Ticketmaster did not provide comment before publication.

Asked about this possibility, Mr. Naqvi said, "I think of myself as a consumer, and if I knew the law was that nobody could charge more than 50 per cent above face value, I would not pay [more]."

The legislation also proposes to protect other "big purchases" for consumers. These include:

• Separating the regulation of new home builders and vendors from Tarion Warranty Corporation and creating a new administrative authority. Tarion would still administer a home-warranty program.
• Making dispute resolution easier for homeowners who discover construction problems.
• Clarifying and more tightly regulating the practice of “double ending,” where a real estate agent represents both parties in a sale.
• Creating new rules for travel-service businesses, including new registration requirements for individual salespersons.