TICO TALKTICO TALK October – December 2010

I N T H I S I S S U E . . .Letter from the CEO . . . . . . . . . . . . . . . . 2Report on the 13th Annual General Meeting . . . 3Presenting Jill Wykes . . . . . . . . . . . . . . . . . . . . . . . 4

Increasing Consumer Awareness . . . . . . . . . . 4Reaching Out to Accountants . . . . . . . . . . . 5Court Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

By the time you read this, the revamped website at www .tico .ca will have been launched. Much time and thought has been invested into the overhaul. We wanted to be absolutely certain that the most relevant, informative and engaging presentation of needed information is an easy click away, whether the visitor to our site is a TICO registrant or a consumer of travel services in Ontario.

As announced in the last issue of TICO TALK, the home page will offer a clear distinction between the Consumer and Industry sections. It will also feature a box dedicated to Latest News – to include suspensions, advisories, closures and press releases – as well as a link to the five on-line videos that were

launched last year (on TICO, and the four ways that TICO protects consumers’ travel investments through Regulation, Monitoring, Refunds and Complaints).

It will be much easier for consumers to find a TICO-registered travel agency – and the Registrant Search Feature has been enhanced to include any charges and convictions in the search results, as well as the date of initial registration and the registration renewal date. The site will also offer checklists to assist consumers who are

considering purchasing travel services, information on how the Compensation Fund works, and a consumer’s step-by-step guide through the claims process in the event of a registrant’s failure. There is a section devoted to Legislation & Regulation, another to Publications & Resources. The website also has the ability to adjust the size of the font.

Beginning December 1, anyone who can identify

where TICO the dog is ”vacationing” can enter the Win Your Dream Trip Sweepstakes at www .tico .ca/go The prize consists of a cheque for $5,000 that the winner may use towards the cost of his or her dream trip.

The redesign is targeted equally at registrants. Once you click on the Industry Info tab at the top of the homepage, you will arrive at the TICO Logo/Consumer Awareness Tool Kit, where a wide selection of TICO logos and messaging can be downloaded for use on your own website, within e-mails and in your digital and print marketing - such as on e-ticket stuffers and itinerary confirmations. Other collateral marketing materials include brochures and window decals. TICO is conducting an extensive

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Building Awareness…Among Consumers and Registrants!

2TICO TALK

LETTER FROM THE CEO

INDUSTRY REPRESENTATIVES

Jim Diebel President

Hanover Holiday Tours Limited Hanover, ON

Mike Foster President

Uniglobe Instant Travel Inc. London

Jeff Element – Vice Chair President

The Travel Corporation (Canada) Toronto

Denise Heffron Vice President, Commercial

Transat Holidays Etobicoke

Thanushka Nanayakkara, CTM President

NARAT Incorporated Toronto, ON

David Shaw President

Evans Intravel Inc. Orillia

Scott Stewart President

G. Stewart Travel Services Ltd. Peterborough

Richard Vanderlubbe President

Travel Superstore Inc. Hamilton

Kathleen Warren, CTM Senior Travel Consultant

Allison’s Travel Agency Ltd. Windsor

Jill Wykes Senior Vice President, Human Resources

Thomas Cook Canada Toronto

MINISTERIAL APPOINTMENTS

Michael Janigan, J.D., LL.M. – Chair Executive Director and General Counsel

Public Interest Advocacy Centre Ottawa

Patricia Jensen Board Member

Consumers Council of Canada Toronto

Shaher Bano Noor, C.A. Managing Partner

Rosenthal Pervez & Noor LLP Chartered Accountants Mississauga

Dr. James Savary Department of Economics

Glendon College, York University Toronto

Maria Mendes, LL.B. Barrister & Solicitor Mendes Law Firm

London, ON

EX OFFICIO

Michael Pepper President and Chief Executive Officer

Travel Industry Council of Ontario

This edition of TICO Talk coincides with the launch of TICO’s new website www.tico.ca. The vastly improved website provides valuable information to registered travel agencies and to consumers. Please take some time to view the new site and take advantage of the many downloads that will assist you with your business.

TICO’s Consumer Awareness Campaign has also kicked off with a contest running on TICO’s website. Early next year, the campaign will target consumers at Toronto’s Union Station and in the Path walkways towards the RBC Plaza. The intention of the campaign is to drive consumers to the TICO website. Our goal is to educate consumers on the value of using a TICO registered travel agency for their travel arrangements.

TICO’s AGM took place on November 1, 2010 at the Toronto Congress Centre. At the AGM, TICO announced that Jim Diebel, President of Hanover Holiday Tours was elected for the two year wholesale position on the Board. I would like to welcome Jim Diebel to the TICO Board. For those who were unable to attend the AGM, TICO’s Annual Report is posted on the website along with the Business Plan for 2010 to 2013. TICO no longer distributes hard copies of these documents to all registrants. The documents can be viewed online, downloaded or registrants can request a hard copy from TICO.

Following this year’s AGM, the TICO Board elected a non-industry Board member as Chair of the Board. This is in accordance with a change that was made to TICO’s by-laws at the 2009 AGM. Michael Janigan, who is Executive Director and General Counsel for the Public Interest Advocacy Centre (PIAC) in Ottawa, was elected Chair for a three year term. The Vice Chair position will alternate between a wholesale registrant member and a retail registrant member each year. Jeff Element, President of the Travel Corporation Canada, was elected as Vice Chair for the next year.

Wishing you all the very best for the holiday season and a successful 2011.

Michael Pepper CEO

TICO BOARD OF DIRECTORS

2010

3 TICO TALK

TICO’s 13Th annual general meeTIng TOOk plaCe On nOvember 1sT aT The TOrOnTO COngress CenTre, aT whICh The 2010 annual repOrT and The 2010 busIness plan were Tabled. The meeTIng was ChaIred by JIll wykes, ChaIr Of TICO’s bOard Of dIreCTOrs.

The meeting was the first TICO AGM to be webcast. The report from the Chair provided an overview on a range of topics of interest and relevance to Ontario’s travel industry.

Highlights from the Chair’s Report

Independent Report regarding One Step Travel: The Independent Review of TICO’s Compliance with Policies and Procedures re: One Step Travel was released on October 7, 2010. The report was prepared by the Ministry of Finance, Treasury Board Office, Ontario Internal Audit Division. It looked at TICO’s handling of the closure of One Step Travel.

Overall, the report found that TICO had followed established policies and procedures and reasonably handled the closure and related claims from consumers. Two areas were identified where TICO could improve its practices: clarifying its policies on when proposals to revoke registration should be issued, and improving certain documentation practices.

In response, TICO is moving to strengthen its policies and procedures in four areas – Registrar discretion, inspection of branch offices, documentation and file maintenance, and transfer of bookings. As well, the Board clarified its own policies regarding the review of large closures. The complete report is available at www.tico.ca.

Conquest Vacations: There is close to $1 million in Conquest Vacations trust accounts, which were frozen by TICO on April 17, 2009. TICO has submitted a total claim of $2,242,007.57, of which $950,084.04 is against Conquest’s trust accounts, and the remainder is an unsecured reimbursement claim on the estate of Conquest. As the Trustee for Conquest has disallowed TICO’s claim against the trust accounts, TICO served a Notice of Motion appealing this decision, in the belief that the funds held in trust are being held on behalf of consumers. The Motion was heard on March 24, 2010 in the Ontario Superior Court of Justice, but the Court has not yet reached a decision on TICO’s motion.

Following the Conquest failure, the province’s report, the Assessment of Consumer Protection against Financial Instability in the Travel Industry was released. The Chair’s Report included detailed remarks on the current status of the report’s four main recommendations:

That more information be provided to consumers on TICO’s •website

That registrants be required to give notice to TICO of their •intention to cease operations

That trip completion compensation provisions in the Regulation •be enhanced.

A New BoardIt was recently announced at the Annual General Meeting that Jim Diebel, President of Hanover Holiday Tours, had been elected for the wholesale position. TICO extends a warm welcome, and looks forward to benefiting from his considerable expertise over the next two years.

Following the AGM, Michael Janigan, Executive Director and General Counsel of the Public Interest Advocacy Centre was appointed Chair – in compliance with the Ministry’s request that the Chair of the Board be selected, for a three-year term, from one of the five ministerial appointees. The Board is delighted to have Michael at its helm. Jeff Element, President, Travel Corporation Canada, was named Vice Chair of the Board for a one-year term. And last, but not least, TICO would like to offer heartfelt thanks to Brett Walker, General Manager of Collette Tours Canada, for his nine years of valuable service as a Board member. His thoughtful consideration and expertise were greatly valued by the Board and TICO staff.

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Report on the 13th ANNUAL GENERAL MEETING

Brett Walker

4

TICO TALK

Between her own career and TICO, Jill Wykes has acquired a unique perspective of the travel industry in general, and Ontario’s in particular. Originally a journalist and the former editor of Travelweek Bulletin, Jill then became the first executive director of the Canadian Association of Tour Operators (CATO). From there she joined Sunquest Vacations in a communications and industry affairs role, and subsequently Vice President, Sales for Sunquest, Alba Tours and The Holiday Network.Her next two positions were as Vice President, Customer Service, Resort Management & Quality Assurance with MyTravel Canada, and then Senior Vice President, Operations with Thomas Cook Canada. Eighteen months ago she became Senior Vice President, Human Resources for Thomas Cook Canada.Throughout her career’s progression, Jill has played a leading role in industry affairs and in TICO. Initially, as a CATO board member, she helped form the Ontario Travel Industry Self Management coalition, OTISM, which led to the creation of TICO in 1997. Since then, except for two years, she has sat on the Board of Directors, and recently completed her third term as chair.With her considerable experience in mind, TICO TALK asked Jill to share her views on TICO’s current and future role.

Why has TICO been so important to you?I believe strongly in participating in the regulation of our business, given that travel is not evenly regulated in Canada. It is vital that we try to ensure as level a playing field as possible for the industry until there is harmonized legislation in all of the provinces. There are so many gaping holes in consumer protection that it’s very difficult for the industry and the consumer to know where there is consumer protection and where not, unless you take the time to learn about it.

We have to participate fully in every aspect of the regulatory process. Over the years, I’ve seen many occasions when the industry has been able to shape, prevent or add things that were critical to maintaining a healthy industry, or even to ensure operational capability. With government, industry and consumer perspectives to balance, our input is critical. That is why it is so important that the entire industry participates, whether through TICO or any of the other industry organizations. We have to collectively represent ourselves throughout this process.

PRESENTING

Jill WykesDirectorTICO Board of Directors

Excellent results from the Consumer Awareness Campaign 2009/10A multifaceted promotional campaign was held throughout Ontario, comprising television ads, radio ads, print ads, television and radio interviews, web banner ads, online pay-per-click ads, enhancements to TICO’s website, and editorial coverage resulting from 75 media interviews that promoted knowledge and awareness of TICO in a range of ethnic and community publications. As proof of its effectiveness:

• Visits to TICO’s website increased from 1,864 visitors in November 2008 to March 2009 to 24,038 visits during the same period in 2009/10.

• Organic searches for TICO on Google during the same period increased to 23,214 from 2,707 the previous year

• Understanding of TICO increased to 74% in 2009/10 compared to 65% in 2008/09 according to an online omnibus survey. provisions.

5 TICO TALK

Considering how much the travel industry has and continues to change – from lots of players on the wholesale side to fewer but larger companies, to the evolution of online travel agencies that can be based anywhere – having the right consumer protection legislation, and the ability to communicate to the consumer as to where his purchase is protected is key.

What are your thoughts on harmonizing travel legislation across the country?

It is one of TICO’s goals, and a very important one. Michael Pepper has been working diligently with the other provincial jurisdictions towards making it achievable. Whether the other provinces develop their own model of travel legislation or we find a way for them to opt in to the TICO fund, there should be a universal system in place. A related issue of deep concern is that airlines are regulated federally, while the provinces regulate consumer protection. It’s a serious gap brought about by jurisdictional issues that has to be addressed if we want the consumer protected in all travel purchases.

What about the future financing of the Compensation Fund? User pay schemes, as opposed to industry-funded schemes, are under much discussion at the moment. In fact, the consumer pays anyway, but user pay is more transparent. If the consumer paid a very small amount each time they purchased travel services, it could provide protection to all Canadian consumers, covering every kind of travel. But that requires the cooperation of provincial and possibly federal legislators, depending on the approach.

Since TICO does not regulate the airlines, or any other supplier, it is complicated for registrants to explain to their clients when they are covered and when they are not. This should be simplified, from both an industry and consumer perspective, and a user-pay scheme would address this concern. It has been done successfully in other jurisdictions – Québec is one that comes to mind.

How do you rate the industry’s participation in TICO?With the notable exception of some hard working individuals from ACTA, CATO, OMCA and CITC, not highly, unfortunately. We are still largely ignored by our constituents. However, there are a handful of vocal registrants who take us to task on many things, and in fact, much of the time, I welcome this. We should be absolutely open to scrutiny. TICO would benefit greatly from more people actually understanding how it works, and being willing to volunteer on the committees and at the Board level. I’d like to see more people attending our Annual General Meeting. As it’s your business/ livelihood, why wouldn’t you grab the opportunity to have input or to learn more about how you are regulated?

Reaching out to Accountants TICO’s revamped website will include a section specifically for accountants who are preparing financial statements on behalf of TICO registrants. Let your accountant know that this resource is available to them. Although the requirements are detailed in Sections 22 to 29 of Ontario Regulation 26/05, the website will provide information regarding what is required when registrants submit their financial statements to TICO. The main points are as follows:

Due date: Year-end financial statements are due 90 days after the registrant’s year-end, and no extensions are granted. The Registrar may issue a proposal to revoke the registrant’s registration if financial statements have not been filed on time.

Type of financial statement required: It must be prepared under a Review Engagement or an Audit by an accountant who is licensed under the Public Accountancy Act, 2004.

What should be included: a balance sheet, income statement, statement of Ontario gross sales and a reconciliation of consumer funds held, as stated in Section 27 of the Regulation (trust funds) to the trust bank accounts.

Accountants will also find on the website an explanation on what the Ontario gross sales should include, and on the alternative ways that the reconciliation of customer funds compared to the trust bank statement can be disclosed.

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6TICO TALK

Report On The 13th Annual General Meeting continued from page 3

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That the Minister initiate discussions with his federal and •provincial counterparts on a national scheme for travel compensation, and on the impact of credit card requirements on tour operators.

Ontario Regulation 161/10, which came into force on July 1, 2010, addresses both the requirement to provide notice when ceasing operations and the trip completion compensation issues.

With regard to enhancing the information for consumers on TICO’s website, TICO has already made recommendations – to which the Ministry has agreed – on areas where possible additions and enhancements can be made.

However, the Board has significant concerns about posting information on the number of complaints TICO has received regarding a registrant, whether TICO is holding security, whether a registrant’s fund contributions and financial statements are up to date, and the date of TICO’s last inspection.

Due to the complexity and context of each case, a consumer’s interpretation of the information may not reflect the reality of the situation. In addition, the Board felt that the cost of the continuous updating that would be required, considering the information may be of questionable value to consumers, was not warranted.

Registrant Commissions and the Compensation Fund: As requested at last year’s AGM, the Board reviewed the issue of allowing travel agents to seek reimbursement from the Compensation Fund for commissions due from a wholesaler but not paid, as a result of a registrant wholesaler closure. After careful deliberation, the Board concluded that the fund exists for consumer protection only, and it will not recommend any amendment to the Regulations in this area.

Board Composition: In the last year, the Board has conducted a registrant survey and held town hall meetings on this issue, and greatly appreciates the feedback from registrants. Since the Board is simultaneously reviewing the entire election process, it is not yet ready to make a recommendation.

From the President and CEO

Michael Pepper presented the 2010 Annual Report, summarizing the outcomes and achievements made in relation to the objectives set out in TICO’s 2009 Business Plan. Specific items highlighted by Mr. Pepper were as follows:

Considering the current economic climate, TICO’s Financial Inspection Program has been a top priority over the past year. Monitoring financial risk and proactively ensuring that consumers are protected are of extreme importance. During the fiscal period 2009/2010, 1,787 bench reviews were conducted (compared with 1,916 the previous year) and 688 financial site inspections (compared to 631 the prior year).

The Consumer Awareness Campaign continues to be a top priority. Last year’s goal was to get more consumers to visit TICO’s website and learn about TICO. While this push will continue, the

Dates to Note

January 7 – 9, 2011

Canada’s Bridal ShowMetro Convention Centre

North Building255 Front Street West

Toronto

February 25 – 27, 2011

Toronto OutdoorAdventure Show

International Centre, Hall 56900 Airport Road

Mississauga

TICO will be distributing informational material at the above

shows.

TICO TALK Feedback

With so many challenges confronting today’s travel industry – for further insight, please read the profile on Jill Wykes, past chair of

TICO’s Board of Directors, on page 4 – input from TICO registrants can

play a significant role in shaping the future of travel. We urge you to

contact us if you have questions, comments or concerns on anything that you read in TICO TALK, or on any other matter. Your opinions are

important to us. We can be reached at

(905) 624-6241, or at 1-888-451-TICO,

or by e-mail to tico@tico.ca.

7 TICO TALK

Court Matters➤ CONVICTIONS

Brian Watt has been convicted of one count of operating as a travel agent without registration, contrary to Section 4(1)(a) of the Travel Industry Act, 2002. Mr. Watt was fined $3,000. It should be noted that no consumers were affected by the actions of Mr. Watt, who is now in compliance with the Act. The charge of operating as a travel agent against Caledonian Holdings Inc . o/a Christian Journeys & Tours was withdrawn

Maria Lourdes Freire has been convicted of five counts of failing to maintain trust accounting, contrary to Section 27 of Regulation 26/05 made under the Travel Industry Act, 2002. Ms. Freire was the president of Jofir Investments Ltd . o/a College Travel Centre, which closed in January 2009. The Ontario Travel Industry Compensation Fund paid approximately $75,000 in claims to consumers as a result of the closure. Ms. Freire was fined $1,000 and sentenced to a two-year period of probation as well as paying restitution to TICO in the amount of $12,400. The charges against Jofir Investments Ltd were withdrawn.

Ian Sadler has been convicted of one count of operating as a travel agent without registration, contrary to Section 4(1)(a) of the Travel Industry Act, 2002. Mr. Sadler was fined $5,000. The charge against Sadler Musical Productions Inc. was withdrawn. Mr. Sadler and Sadler Musical Productions Inc. are located in Stratford, Ontario.

➤ REVOCATIONS

Between September 3 and November 17, 2010, five companies had their registrations revoked: 861517 Ontario Ltd o/a Orion Travel; Keith Prowse Canada Ltd .; Julie Bevan o/a Cosmopolitan Travel; Michael Shyu and Forng Shyu o/a Global Express Travel Agency; and KC Royal Tours Ontario Inc . ▲

intent is also to get more registrants involved in the campaign during the upcoming year.

Since the Education Standards came into effect on July 1, 2009, more than 22,000 individuals have taken the Education Standards exams.

The exploration of alternate methods to finance the Compensation Fund continues, with particular focus on a consumer-pay model rather than an industry-funded model. Consumer research is likely to be undertaken as the next step in the process.

A total of 2,219 Registrations were processed in 2009/2010, which included 196 new registrations and 2,023 renewals. Of the total registrants, 85% are retail travel agencies and 15% are travel wholesalers. There were 293 terminations during the same period.

TICO’s audited Financial Statements for the year ended March 31, 2010 were presented. A copy of the Financial Statements is included in TICO’s 2010 Annual Report. ▲

Report On The 13th Annual General Meeting continued from page 6

A Hardworking Team:The 2009-2010 Board of Directors

Front Row (left to right): Maria Mendes, Mike Foster, Jill Wykes,

Michael Pepper, Patricia Jensen, Scott Stewart

Back Row (left to right): Kathleen Warren, Thanushka

Nanayakkara, Michael Janigan, Richard Vanderlubbe, David Shaw, Brett Walker,

James Savary, Jeff ElementAbsent: Denise Heffron

and S. Bano Noor

TICO TALK 8

Upcoming Issues

In future issues of TICO TALK we plan to include:

Update on the Consumer •Awareness Campaign

Update on other TICO •initiatives

2700 Matheson Boulevard East,Ste 402, West Tower, Mississauga, Ontario L4W 4V9.

Tel: (905) 624-6241Fax: (905) 624-8631Toll-free: 1-888-451-TICOe-mail: tico@tico.caweb site: www.tico.ca

Copyright (c) 2010 Travel Industry Counci l of Ontar io. A l l r ight s reserved. Contents of this newsletter may be reproduced in whole or in part provided the intended use is for non-commercial purposes and the Travel Industry Council of Ontario is acknowledged as the source on all cop ie s . Some mater ia l s in th i s newsletter may be subject to copyright from an outside source and therefore there may be different restrictions on the reproduction of this material. This newsletter is published by the Travel Industry Council of Ontario and is provided to all Travel Industry Act registrants. The information provided in this newsletter is provided for general knowledge purposes only and is not intended to be legal advice.

Building Awareness… Among Consumers and Registrants! continued from page 1

Presenting Jill Wykes Director TICO Board of Directors continued from page 5

I totally understand that everyone has to run their businesses, but we’re all busy. There isn’t anyone on TICO’s board who isn’t heavily involved in the business that they represent, yet they make time for TICO because they know they can make a difference, and understand the impact on the industry.

Where do you hope to see TICO and the Ontario travel industry in the next five years?

The funding of consumer protection is the biggest issue that must be addressed, by creating a universal user-pay system that is properly weighted to adequately finance a compensation fund for the travel industry. Funding consumer protection on the backs of travel agents and travel wholesalers, to the exclusion of all other travel suppliers, is simply not fair and inadequate.

Another fundamental problem is that we are living with a travel act that was written in the 1970s and regulations that were, for the most part, updated in the 1990s. I would like to see a much more dynamic process for making changes due to the ever changing complexities and the composition of the travel industry today.

What else have you got out of being on TICO’s Board of Directors?

I have met and worked alongside some incredibly bright and dedicated people through my work with TICO, both on the board and among the TICO team. It has been challenging and rewarding on an intellectual level, and I have made some very good friends and colleagues along the way. ▲

advertising campaign on television and radio, on posters displayed at GO stations and in bus shelters throughout Ontario, and in magazines and community newspapers. The campaign will continue to promote the importance of purchasing travel services from TICO-registered travel agencies. Registrants should make the most of the opportunity to promote their affiliation with TICO, in order to maximize the effectiveness of the campaign.

Supporting the need for TICO registrants’ strong commitment to the campaign, a video will be electronically distributed to registrants. In it, industry leaders such as Jonathan Carroll, President of itravel2000.com, Jeff Element, President of The Travel Corporation (Canada), Scott Stewart, President of G. Stewart Travel Services Ltd., and Rita Tsang, President and CEO of Tour East Holidays each talk about how effectively the campaign is promoting the industry’s professionalism, while sending clients your way.

With growing numbers of consumers turning to travel service providers on-line, it is more important than ever that they know how to access the protection that Ontario’s travel legislation provides. ▲