Ontario Regulation 26/05 Flashcards

Under Ontario Regulation 26/05, a travel agent receives a consumer's payment on a Friday afternoon after banking hours. The agent deposits the funds into the trust account the following Monday morning. Which statement best describes the agent's compliance status?

Answer: The agent is compliant because the funds were deposited on the next available banking day.

O. Reg. 26/05 requires trust funds to be deposited on the day received or, if that is not reasonably possible (e.g., after banking hours), on the next day that the financial institution is open for business. Depositing on Monday after a Friday-after-hours receipt is fully compliant — no dollar threshold or consumer consent is required.

A registered travel agent acts strictly as an agent for a disclosed travel supplier and collects payment on the supplier's behalf. Under O. Reg. 26/05, which of the following statements about the trust account obligation is correct?

Answer: The agent is exempt from the trust account requirement only if the supplier is also a TICO registrant and the agency relationship is disclosed in writing to the consumer.

Under O. Reg. 26/05, a travel agent acting as a disclosed agent for a supplier registrant may be relieved of the trust obligation for those specific funds — but only when the supplier is a TICO registrant AND the agency relationship is disclosed to the consumer in writing. Both conditions must be satisfied simultaneously. If either is absent, trust account rules apply.

A travel wholesaler registered under the Travel Industry Act, 2002 advertises a package to Cancún and lists the price as '$899 per person.' The fine-print footer states that taxes, fuel surcharges, and airport improvement fees total an additional $340. Under O. Reg. 26/05's advertising requirements, this advertisement is:

Answer: Non-compliant, because all-inclusive pricing — including taxes and mandatory fees — must be prominently stated as a single total price.

O. Reg. 26/05 requires that advertised prices for travel services include all mandatory charges — taxes, fuel surcharges, airport improvement fees, and other unavoidable costs — in a single, prominently displayed total. Burying mandatory fees in fine print does not satisfy this requirement regardless of medium (print or digital). The purpose is to prevent misleading low-ball headline prices.

Under O. Reg. 26/05, a consumer enters into a written contract with a travel agent for a $4,200 vacation package. The contract does not include the registration number of the travel agent's brokerage. Which of the following outcomes is most accurate?

Answer: The contract remains enforceable, but the registrant has committed a regulatory violation subject to TICO's disciplinary powers.

O. Reg. 26/05 requires that written contracts for travel services include the registrant's TICO registration number. Omitting it is a breach of the regulation and exposes the registrant to regulatory discipline — however, the contract itself is not automatically void. Consumer contract enforceability is a matter of contract law; the regulatory violation is a separate matter handled by TICO.

A travel agent receives a consumer complaint alleging that the agent misrepresented the star rating of a resort. The agent argues that the star rating was taken verbatim from the supplier's own brochure and that the agent bears no independent liability. Under O. Reg. 26/05's conduct standards, which position is most accurate?

Answer: The agent bears responsibility for representations made to consumers regardless of whether those representations originated with the supplier, and must take reasonable steps to verify claims.

Under O. Reg. 26/05 and TICO's Code of Ethics, registered travel agents are responsible for the accuracy of representations made to consumers and must take reasonable steps to verify supplier claims before passing them on. A 'I copied it from the brochure' defence does not automatically insulate an agent. The agent's professional duty extends to exercising reasonable diligence about material facts like accommodation quality.

A TICO-registered travel agency is acquired by a new owner. The new owner continues operating under the existing TICO registration and certificate of registration without notifying TICO of the ownership change. Under O. Reg. 26/05 and the Travel Industry Act, 2002, this situation is best described as:

Answer: A violation, because a certificate of registration is not transferable and the new owner must apply for a new registration before operating.

Under the Travel Industry Act, 2002 and O. Reg. 26/05, a certificate of registration is personal to the registrant and is not transferable to a new owner. When ownership of a travel agency changes, the new owner must apply to TICO for their own registration and receive approval before operating under the Act. Continuing to operate under the previous owner's registration — regardless of any transition period — is a violation. There is no 90-day grace period for this requirement.