In December 2006, the Ontario government passed the Consumer Protection and Service Modernization Act, the latest reform in an ambitious overhaul of consumer protection and public safety legislation. Implemented over the 2002-2006 period, the scope of these reforms is broad, affecting 12.7 million consumers and most of the retail businesses in Ontario’s $80 billion economy.
The legislation includes provisions for key sectors such as real estate, travel, funeral homes and cemeteries, and electrical products, as well as laws of general application that cover most other consumer transactions – all intended to strengthen consumer protection, modernize the legal framework for businesses and improve public safety.
While this ambitious reform agenda had the potential to become quite fractious, Ontario was able to implement the new legislation in close partnership with the consumer and business communities.
Putting consumers first
The legislation is the result of a multi-year effort from 1999 to the present. New acts include: Consumer Protection Act, 2002; Funeral, Burial and Cremation Services Act, 2002; Real Estate and Business Brokers Act, 2002; and Travel Industry Act, 2002. In addition, significant amendments were made to a number of existing statutes: Bailiffs Act, Athletics Control Act, Collection Agencies Act, Consumer Reporting Act, Electricity Act, Land Titles Act, Liquor Licence Act, Repair and Storage Liens Act and others.
One of the most important issues addressed in the new legislation is real estate fraud. The Land Titles Act was amended to ensure that consumers’ title couldn’t be lost as a result of the registration of a falsified mortgage or fraudulent sale. The legislation also increases fines and penalties and amends the Land Registration Reform Act to suspend and revoke access to the electronic registration database for fraudsters so they cannot register documents.
A recent Statistics Canada study shows that in 2005, 80 percent of large retailers were offering gift cards, up by 29 percent from two years earlier. Despite their popularity, however, consumers have complained that many retail gift cards contain conditions such as expiry dates, which are not clearly disclosed at the point of sale. Similar to many US states, Ontario’s new consumer legislation requires retailers to clearly disclose conditions on gift cards and to limit or prohibit expiry dates and fees.
The Liquor Licence Act was also amended to increase the enforcement powers of the Alcohol and Gaming Commission of Ontario and to authorize establishments to have additional areas of their premises licensed to reduce the risk of date rape drugs being slipped into unattended drinks.
In addition to strengthening consumer protection, the legislation aims to modernize and improve the way our government delivers services to Ontarians. It will also strengthen the ability of ServiceOntario to provide “one-stop” services on behalf of partner ministries as the government’s “retail expert.”
From the beginning, the Ministry of Government Services recognized that the reforms would affect a diverse group of businesses and consumer interests. They implemented an innovative policy consultation, which included five initiatives. As a result, when the bill was passed, media coverage indicated a surprising degree of consensus among stakeholders in support of the reforms.
§ The ministry held a series of roundtables to allow stakeholders to exchange their views face-to-face on the legislation, and to work through issues together, rather than through bilateral meetings with officials.
§ For key issues such as the Funeral, Burial and Cremation Services Act, the ministry retained a professional mediator to help broker a consensus. Using mediation in policy development was referenced as an innovation in a recent web-based inventory of policy best practices.
§ The release of various white papers, including Consumer Protection in the 21st Century, gave stakeholders across the province the chance to review and comment on legislative proposals.
§ For key issues, the ministry provided a dedicated e-channel for stakeholders to exchange briefs, leading to more productive roundtable discussions.
§ The ministry developed an interactive webcast with the Minister and Assistant Deputy Minister to communicate key legislative changes with stakeholders. Participants heard about key provisions and engaged in a Q&A.
§ As well, the ministry launched the Consumer Protection Branch in a new location using various communications channels to provide consumers with a location for assistance under the new statutes.
Since many businesses operate across Canada, stakeholders expressed an interest in minimizing differences in regulatory requirements between provinces. The ministry was an active participant in the Federal/Provincial/Territorial Consumer Measures Committee, which developed a number of “harmonization templates” intended to provide provincial legislators with a roadmap to harmonization.
The best policy reforms can fall flat when they meet the challenges of operational implementation. To increase the success of its consumer protection programs, Ontario has created a number of Delegated Administrative Authorities, such as the Real Estate Council of Ontario, the Electrical Safety Authority, the Ontario Motor Vehicle Industry Council, the Technical Standards and Safety Authority and the Travel Industry Council of Ontario. By giving them a single focus for administering specific legislation governing their sectors, the ministry is aiming for higher levels of operational effectiveness.
To deal with cross-border enforcement issues, the ministry worked with other law enforcement agencies to set up Toronto’s Strategic Partnership. Because inter-jurisdiction cooperation is often difficult, the ministry has partnered with Toronto Police Services, the Competition Bureau at Industry Canada, the Ontario Provincial Police, the US Federal Trade Commission, the US Postal Inspection Service and others. This initiative has been very successful. In fact, in its first year of operation, it closed down more than 100 criminal telemarketing “boiler rooms” and returned more than $1 million to consumer victims. It also won the Institute of Public Administration of Canada award for Innovative Management, the US National Consumer Agency Achievement Award and the Ontario Amethyst Award.
To ensure optimal allocation of inspection and investigative resources, the ministry adopted a risk-based framework for prioritizing consumer complaints. Other successful initiatives included adoption of “Balance Scorecard” performance measures, which set targets and measure progress to make sure we have good client satisfaction on services we offer, and development of the “Consumer Beware” website, which allows consumers to conduct online searches of companies’ complaint records.
Next steps include completing a round of consultations on the regulations for the Funeral, Burial and Cremation Services Act and finalizing regulations for the Motor Vehicle Dealers Act to provide further protections to bereaved consumers and car purchase