ACTA and CATO will no longer have dedicated seats on the TICO board as they have done since the regulator's inception, following changes to the composition of TICO's board announced late Friday, 11AUG, ACTA says in a statement.
While an ACTA statement in response says the organization was expecting the move, it comes after ACTA and CATO took the unprecedented step last month to remove their respective members from the TICO board in protest of being kept in the dark about TICO's recommendations to the province about the future structure and funding for the Compensation Fund.
According to TICO's Friday announcement, the Ontario government has ordered it to make changes to its board makeup. The release said it had received a letter from the Minister of Public and Business Service Delivery, outlining five orders for the organization, including:
- Decreasing the number of board members from 11 to nine;
- Ensuring all board members “possess a positive orientation for proactive consumer protection initiatives;"
- Ensuring no more than 34 per cent of the members of the Board are drawn from the travel agent and travel wholesaler industry;
- Establishing a nominations committee with requirements around eligibility criteria for nominated board members; and
- Setting up an industry advisory council, comprised of members representing the interests of travel agents and travel wholesalers to report to and advise the board.
ACTA says it’s not surprised by the news.
“ACTA met with the Ontario Attorney General last spring and the Director of Consumer Policy in early July. Both groups spoke about this future model for the TICO board and advised that all other Ontario regulators moved to this model after their AG audit. TICO went through an auditor general audit early this year so we were expecting this change.
“Regardless of this change in board composition, it is important that the voice of the industry is heard by TICO and the Ontario government – and to this end, there will be two industry directors on the new board and there will be an industry advisory council formed.”
ACTA said anyone interested in being considered for the TICO board must apply by 21AUG, 2023.
TICO fee structure and Comp Fund funding still unknown, ACTA says
The changes to TICO's board structure come as tensions remain high between the regulator and the industry.
“ACTA is still in the dark about recommendations for any changes to the TICO fee structure and the mechanism for funding the Compensation Fund,” ACTA's statement said. “Last month, ACTA and CATO took the unprecedented step of removing appointees from TICO board meetings until the TICO AGM in September –or, until they are given a copy of TICO’s recommendations to the Ontario government on TICO’s future fee structure and Compensation Fund funding.
“ACTA has requested an urgent meeting with Minister Kaleed Rasheed, Minister of Public and Business Service Delivery of Ontario to discuss the Ontario Consumer Compensation Fund funding model before TICO’s consultation with registrants and stakeholders takes place this fall.
“The Ontario government continuously “says” it is committed to red tape reduction – a reduction in administrative and financial burden on Ontario business. They say…Ontario is ‘open for business’,” ACTA said. “The message that ACTA has delivered to government is clear. The industry cannot and should not be bogged down by unnecessary administrative burden to run a travel business in Ontario. The industry cannot and should not be required to financially support an ever-expanding regulator with increased unnecessary legislation and fees.
“Our message has been consistent,” ACTA said. “If the Ontario government is committed to a Traveller Consumer Compensation Fund in Ontario to cover potential bankruptcies, the current compensation should be fixed, including…that the beneficiary of the fund – the travel consumer – should be the contributor to that fund as is the model in Quebec.
“The industry is recovering from a catastrophic global pandemic and should not and cannot support unnecessary administrative and financial burden.”
“ACTA and CATO have been denied details on the fee mechanism despite a decade of advocating for change,” ACTA president Wendy Paradis said last month. “Both ACTA and CATO have appointees on the TICO board and yet have been excluded from this information despite numerous requests."
TICO defends board changes
On its part, TICO said the board changes will provide a range of benefits, including
- Enhancing consumer protection;
- Enhancing accountability for the sector; and
- Providing a forum for industry to identify issues and provide advice to TICO’s board.
The changes also provide “an opportunity for TICO’s Board to lead in governance best practices, mirroring the recommendations given by the Auditor General of Ontario to other Ontario regulators,” TICO said.
“While TICO’s existing Board structure has served the organization well for many years, this governance change brings added balance to the Board and reflects best-in-class governance practices,” said TICO CEO Richard Smart. “This change allows for a more diverse range of voices to actively contribute to TICO’s consumer protection mandate, while still ensuring the industry has a strong voice at the table.”
The Board of Directors is responsible for providing ongoing strategic oversight and governance to TICO as it fulfills its mandate of consumer protection.
TICO said will host a webinar in the coming month to provide more information about how the Minister’s Orders will be implemented and provide an opportunity for registrants and stakeholders to ask questions.
More information will be shared soon, TICO said.