Canada: Ontario Is Looking To The Public For Advice On Changing Ticket Resale Laws

Last Updated: March 15 2017
Article by Jeffrey Spiegel (Student-at-Law)

Ontario is looking to change the province's laws that regulate the secondary ticket market for sporting events, concerts, and other entertainment events. In the process of doing so, the government is looking to the public for input in developing "practical solutions" that assist consumers in ticket buying and selling—with a focus on accessibility, affordability, transparency, and enforcement.

The Liberal government's goal is to introduce new legislation this spring, according to Attorney General Yasir Naqvi.

"Fans deserve a fair shot at getting tickets to seeing their favourite band, sports team, or performance, but right now, the rules around buying and selling tickets online are not doing enough for fans. They are not putting them first. Our government is going to change that," said Naqvi.

As part of the consultation process, Ontarians are being encouraged to fill out an online survey before March 17, 2017.

By introducing new legislation, the government is trying to prevent individuals and organizations from using computer software to make bulk purchases of tickets to resell at above face value. These software programs, also known as "scalper bots", are being used to buy up the majority of tickets available in the primary market, so re-sellers can force consumers to purchase tickets in the secondary market at exorbitant markups.

In recent years, technology has increased the ability to buy and resell tickets. As a result the secondary ticket market for entertainment events has become a billion-dollar industry around the world, and institutional ticket re-sellers have been taking advantage of that lucrative market. It has become very evident through recent years with such teams as the Toronto Raptors, Toronto Blue Jays, Toronto FC, and Toronto Maple Leafs making their case as playoff teams, that causes scalpers to continue to take advantage of the market. It does extend past Ontario sports however, with performers such as Drake, Justin Bieber, the Hip, and even The Weeknd – when performing in Ontario. The Ottawa Senators have even been subject to scalpers upping the price of their tickets.

The Ontario government is also looking to consult with other jurisdictions that are facing the same issues with scalper-bot technology, such as New York, as well as artists and entertainment industry representatives.

In the meantime, Ontario MPP Sophie Kiwala has introduced a private member's bill intended to ban scalper bots. Bill 22, which has passed its second reading in the Ontario Legislature, would make it illegal to use software that bypasses security measures on ticket-selling websites.

The upcoming government legislation is hoping to build on Kiwala's bill, but the Attorney General points out that enforcement is often the major issue. It is difficult to police those operating in other jurisdictions and prevent them from using scalper bots.

New York state recently made changes to its laws—making the use of scalper bots a criminal offence, punishable by steep fines, and for repeat offenders, imprisonment. The changes came after the state fined six ticket brokers in a rare instance of enforcement but determined that the existing fines did not serve as a sufficient deterrent because online scalping was so lucrative.

The New York state attorney general has also recommended implementing a cap on the mark-up that brokers can charge.

The secondary ticket market in Ontario came into the spotlight in 2016 after fans cried foul when they were unable to purchase tickets for the Tragically Hip's final tour. Within minutes of being offered for sale, tickets open to the general public were sold out, and being offered for sale on resale websites, such as StubHub, at extreme markups—sometimes at multiple times their face value.

Ticket scalping (reselling tickets for above their face value) had always been illegal in Ontario. But that changed on July 1, 2015, when the Ticket Speculation Act came into force. The act, aimed at reducing fraud and creating greater consumers confidence in ticket purchasing, allowed re-sellers to make a profit as long as tickets were authenticated. But unfortunately that change opened the floodgates to the problem that the government is now trying to fix.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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