TICO - Travel Industry Council of Ontario Exam — Questions and Answers

Question 1: Under TICO's standards, when must a travel registrant inform a client about the availability of travel insurance?

Only for international travel bookings exceeding $2,000
Only when the client specifically requests information about insurance
Only after the client has signed the booking contract
At the time of booking, as part of the registrant's duty to advise the client (Correct answer)

Correct answer: At the time of booking, as part of the registrant's duty to advise the client

TICO's duty-to-advise standard requires registrants to proactively inform clients about the availability of travel insurance at the time of booking. Waiting for the client to ask, or doing so only after signing, does not satisfy this obligation.

Question 2: A Toronto travel agency advertises a flight-and-hotel package at $1,299 per person in a newspaper flyer. The fine print states the price is available for '2 seats only.' Under TICO advertising standards, which statement best describes the agency's obligation regarding seat availability disclosure?

Disclosing seat quantity is optional as long as the ad includes a 'subject to availability' disclaimer.
The number of seats available at the advertised price must be disclosed clearly and conspicuously, and the agency must be able to demonstrate those seats existed at time of publication. (Correct answer)
Advertising any price with fewer than 10 available seats requires a bold disclaimer on the same page as the price.
A minimum of 5 seats must be available at the advertised price; fewer seats render the advertisement non-compliant regardless of disclosure.

Correct answer: The number of seats available at the advertised price must be disclosed clearly and conspicuously, and the agency must be able to demonstrate those seats existed at time of publication.

TICO requires that when a limited number of seats or units are available at an advertised price, that limitation must be disclosed clearly and conspicuously — not buried in fine print. Critically, the registrant must also be able to substantiate that the advertised seats actually existed at the time of publication. A generic 'subject to availability' clause does not satisfy this requirement, and TICO sets no fixed minimum seat count threshold.

Question 3: Who contributes to the TICO Travel Industry Compensation Fund?

International airlines operating in Ontario
Ontario consumers who purchase travel insurance
TICO-registered travel agents and wholesalers through levies (Correct answer)
The Ontario government from general tax revenue

Correct answer: TICO-registered travel agents and wholesalers through levies

Registered travel agents and wholesalers pay levies into the Compensation Fund, creating a pool of money to compensate consumers if a registrant fails.

Question 4: TICO receives credible information that an unregistered person is actively advertising Ontario travel services to consumers online. Which of the following enforcement tools is available to TICO's Registrar WITHOUT first obtaining a court order?

Issue an Order to Comply requiring the unregistered person to cease and desist, enforceable as an offence if ignored (Correct answer)
Seize the unregistered person's bank accounts to protect consumer funds
Directly impose a monetary penalty of up to $250,000 on the unregistered person through an administrative penalty order
Apply to the Licence Appeal Tribunal to immediately suspend the individual's ability to advertise travel services

Correct answer: Issue an Order to Comply requiring the unregistered person to cease and desist, enforceable as an offence if ignored

Under the Travel Industry Act, 2002, the Registrar has the authority to issue a cease and desist order (sometimes called a compliance order) to an unregistered person carrying on activities that require registration. Ignoring such an order can constitute an offence under the Act. Seizure of bank accounts requires court involvement, the $250,000 administrative penalty figure does not accurately reflect the Act's provisions for unregistered persons, and the LAT's jurisdiction applies to registrants, not unregistered parties.

Question 5: A cruise booking confirmation sent to a consumer describes port taxes as 'approximately $175, subject to adjustment by the cruise line prior to sailing.' When the final invoice is issued 10 weeks later, port taxes have increased to $263. The consumer objects. What is the registrant's most defensible position under TICO standards, assuming the original contract language was properly disclosed at booking?

The registrant must absorb the $88 difference because any price quoted at booking—even with a 'subject to change' qualifier—creates a binding price obligation on the registrant.
The registrant must refund the entire booking if the consumer objects, as any upward deviation from a quoted price triggers a mandatory cancellation-without-penalty right.
The 'subject to adjustment' language is unenforceable under the Consumer Protection Act because consumers cannot waive their right to a fixed price for mandatory fees.
The registrant may pass the increase to the consumer only if the contract disclosed that government-imposed taxes and third-party port fees are subject to change and outside the registrant's control, and the consumer was informed promptly upon the registrant learning of the increase. (Correct answer)

Correct answer: The registrant may pass the increase to the consumer only if the contract disclosed that government-imposed taxes and third-party port fees are subject to change and outside the registrant's control, and the consumer was informed promptly upon the registrant learning of the increase.

TICO permits pass-through of genuinely variable third-party charges (port taxes, government fees) provided two conditions are met: (1) the contract clearly disclosed at the time of booking that such fees are variable and outside the registrant's control, and (2) the registrant notified the consumer promptly upon becoming aware of the change. When both conditions are satisfied, passing the increase to the consumer is permissible. The registrant cannot, however, absorb or pass along changes silently—timely communication is a compliance requirement, not optional courtesy.

Question 6: A consumer books a trip through a TICO-registered agent but pays the airline directly by credit card for the flight component, and pays the agent only for hotel and transfers. The agent becomes insolvent. Which portion of the consumer's loss is eligible for TCF compensation?

Only the airfare, because airline travel is the primary component of an international trip.
The full trip cost, because the agent arranged all components and is responsible for the entire booking.
Only the hotel and transfer costs paid directly to the agent, because those are the funds the registrant received. (Correct answer)
Nothing, because splitting payment between the agent and airline disqualifies the entire booking.

Correct answer: Only the hotel and transfer costs paid directly to the agent, because those are the funds the registrant received.

TCF compensation is limited to money actually received by the insolvent registrant. The airline payment was made directly by the consumer to the airline — a separate, non-insolvent entity — so it falls outside the Fund's scope. The consumer's potential remedy for the airfare is a credit card chargeback or the airline's own processes. Only the hotel and transfer amounts paid to the agent are eligible for TCF consideration.

Question 7: A supervisor at a travel agency learns that a counsellor on their team has been accepting cash payments from clients without issuing proper invoices. What is the supervisor's obligation?

Report the matter internally and take immediate corrective action to ensure compliance (Correct answer)
Ignore the issue if client complaints have not yet been filed
Wait for TICO's next scheduled audit to address the issue
Advise the counsellor to keep better personal records but otherwise continue the practice

Correct answer: Report the matter internally and take immediate corrective action to ensure compliance

A supervisor who becomes aware of non-compliant practices must take immediate corrective action and address the issue internally. Ignoring violations or waiting for external audits does not satisfy a supervisor's compliance oversight obligations under TICO standards.

Question 8: A travel agent sells a cruise package but the cruise line cancels the sailing 10 days before departure. Under Ontario Regulation 26/05, what must the travel agent do with the consumer's funds held in trust?

Refund the consumer within 30 days (Correct answer)
Wait for the cruise line to issue a credit before acting
Transfer the funds to the travel wholesaler immediately
Retain the funds until the consumer selects an alternative

Correct answer: Refund the consumer within 30 days

When travel services are not provided, the agent must return consumer funds held in trust promptly, generally within 30 days.

Question 9: A travel wholesaler sells vacation packages exclusively to registered travel agents, not directly to the public. Under the Travel Industry Act, 2002, must this wholesaler be registered?

Only if annual sales exceed $1 million
No, because they do not deal with the public directly
Yes, all wholesalers must be registered regardless of who they sell to (Correct answer)
Only if they sell international packages

Correct answer: Yes, all wholesalers must be registered regardless of who they sell to

Travel wholesalers must be registered under the Act regardless of whether they sell to the public or only to registered agents.

Question 10: A client provides their credit card details over the phone to a travel agent to pay for a vacation package. The agent successfully processes the payment. According to Ontario Regulation 26/05, what must the agent do next?

Wait until the final payment is due to issue a single, consolidated invoice.
Promptly provide the client with a receipt or invoice containing all required disclosures. (Correct answer)
Ask the client to come into the office to sign the invoice.
Mail a copy of the supplier's brochure to the client.

Correct answer: Promptly provide the client with a receipt or invoice containing all required disclosures.

Section 38(1) of Ontario Regulation 26/05 states that a travel agent must *promptly* provide a statement, invoice, or receipt to the customer after selling travel services, regardless of the method of payment or booking.

Question 11: If a travel agent receives a commission from a hotel that is significantly higher than usual, what is the agent's disclosure obligation under TICO?

The agent must disclose the elevated commission if it could influence their recommendation (Correct answer)
The agent must refuse the elevated commission
The agent must report it only to their agency manager
No disclosure is required as commission is standard practice

Correct answer: The agent must disclose the elevated commission if it could influence their recommendation

TICO's consumer protection framework requires agents to disclose conflicts of interest, including unusually high commissions that may bias their recommendations.

Question 12: A prospective client asks why their deposit cannot be held in the agency's regular bank account. The best explanation is:

Mixing client funds with agency funds makes it impossible to protect consumers if the agency becomes insolvent (Correct answer)
Regular accounts earn lower interest rates, reducing client returns
TICO requires separate accounts only for deposits over $5,000
Regular accounts are audited too infrequently for proper oversight

Correct answer: Mixing client funds with agency funds makes it impossible to protect consumers if the agency becomes insolvent

Commingling client and agency funds creates a risk that consumer money could be lost if the agency faces financial difficulty, which is why segregation is mandated.

Question 13: A sole proprietor operates as a registered travel agent under her own name. She wants to also operate a second travel business under a trade name. Under the Travel Industry Act, 2002, which of the following is accurate?

She is prohibited from operating under any name other than her legally registered personal name
She may use multiple trade names under a single registration provided she notifies TICO in writing of each additional name (Correct answer)
Trade names require approval only from the Ontario Business Registry, not from TICO separately
She must obtain a separate TICO registration for each trade name under which she carries on business

Correct answer: She may use multiple trade names under a single registration provided she notifies TICO in writing of each additional name

Under TICO's rules, a registrant may operate under one or more trade names under a single registration, but each trade name must be disclosed to and approved by TICO. The registrant is not required to hold a separate registration for each trade name; however, operating under an undisclosed trade name without notifying TICO is a violation. Trade names used must not be misleading to consumers.

Question 14: Which of the following best explains why TICO requires travel agencies to display their TICO registration number?

So consumers can verify the agency is legally registered and covered by TICO protections (Correct answer)
To help airlines identify preferred distribution partners
To allow TICO to track commissions earned by agents
To comply with federal customs and border requirements

Correct answer: So consumers can verify the agency is legally registered and covered by TICO protections

Displaying the registration number allows consumers to verify the agency's standing with TICO and confirms they are entitled to consumer protections under the Travel Industry Act.

Question 15: Under Ontario Regulation 26/05, how long must a travel agent retain records of each consumer transaction?

Five years
Three years
Two years (Correct answer)
One year

Correct answer: Two years

Ontario Regulation 26/05 requires registrants to retain transaction records for a minimum of two years.

Question 16: 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?

The agent is compliant only if the consumer provided written consent to the delayed deposit.
The agent is compliant because the funds were deposited on the next available banking day. (Correct answer)
The agent is in violation only if the amount exceeded $1,000.
The agent is in violation because trust funds must be deposited by the end of the same business day they are received.

Correct 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.

Question 17: A customer books a vacation package and pays in full. Two weeks before departure, the wholesaler increases the price by 10% due to a fuel surcharge. According to Ontario Regulation 26/05, which of the following is true if the contract permits price increases?

The customer can cancel but will forfeit their original payment.
No price increases are permitted after the customer has paid in full. (Correct answer)
The travel agent is responsible for absorbing the 10% price increase.
The customer must pay the additional 10% as fuel surcharges are always permissible.

Correct answer: No price increases are permitted after the customer has paid in full.

Section 38 of Ontario Regulation 26/05 specifies that even if a contract permits price increases, no increase is allowed after the customer has paid in full. If the price increase is more than 7% (and not due to an increase in provincial or federal sales tax) before full payment, the customer has the right to cancel the contract and receive a full refund.

Question 18: What role does TICO play after a registrant's collapse triggers Travel Compensation Fund claims?

TICO reimburses airlines and hotels directly without consumer involvement
TICO acts as a travel agent to rebook all affected travelers
TICO files a lawsuit against the registrant on behalf of consumers
TICO administers the claims process and distributes Fund payments (Correct answer)

Correct answer: TICO administers the claims process and distributes Fund payments

TICO administers the claims process, reviews submissions, and authorizes Fund disbursements to eligible consumers.

Question 19: Which of the following transactions requires a travel agent to deposit consumer funds into a trust account under Ontario Regulation 26/05?

Receiving a deposit for a future travel package (Correct answer)
Processing a corporate credit-card expense report
Issuing a refund to a consumer
Booking a domestic hotel directly for same-day check-in

Correct answer: Receiving a deposit for a future travel package

Funds received from consumers for future travel must be held in trust until the travel services are provided or the funds are remitted to the supplier.

Question 20: What is the purpose of TICO's annual compliance review of registered travel agencies?

To determine TICO's annual budget allocation for each agency sector
To rank agencies for inclusion in TICO's consumer-facing 'Best Agency' directory
To set the Travel Compensation Fund levy rates for the following year
To assess whether each registrant continues to meet the financial, ethical, and operational requirements for registration renewal (Correct answer)

Correct answer: To assess whether each registrant continues to meet the financial, ethical, and operational requirements for registration renewal

TICO's annual compliance review assesses whether each registrant meets ongoing requirements for registration renewal.

Question 21: Which of the following consumers would be eligible to make a claim to the Travel Compensation Fund (TCF)?

An Ontario resident who paid a TICO-registered travel agent for a package and the agent became insolvent before travel (Correct answer)
A Quebec resident who booked directly on an unregistered online travel website and lost money
An Ontario resident who booked directly with an unregistered online travel website and lost money
A travel agent who lost their commission income because a supplier went bankrupt

Correct answer: An Ontario resident who paid a TICO-registered travel agent for a package and the agent became insolvent before travel

The TCF is available to consumers who suffer losses when a TICO-registered travel agent or wholesaler becomes insolvent.

Question 22: ABC agency has been in business for six months. The advertising bill must be paid. Can ABC take money from the company trust account to pay the bill?

yes, but only after money is transferred from the general account to the trust account
no, because ABC does not have to maintain a trust account after being in business for six months
yes, because the trust account can be used for operating expenses such as advertising
no, because only the general account can be used for operating expenses (Correct answer)

Correct answer: no, because only the general account can be used for operating expenses

Trust accounts under TICO regulations exist solely to hold client funds (such as deposits for travel services), and those funds cannot be used for the agency's own operating expenses like advertising bills. Operating expenses must be paid from the agency's general account. An agency only six months old is still required to maintain a trust account, and transferring money from the general account into the trust account would not change this restriction.

Question 23: When advising a client travelling to a destination with a Level 3 (Avoid non-essential travel) advisory from the Government of Canada, what is the agent's primary obligation?

Advise the client to purchase cancel-for-any-reason insurance only
Clearly disclose the advisory level and document the client's informed decision to proceed (Correct answer)
Refuse to book the travel and refund all deposits immediately
Contact the destination's embassy to obtain a safety waiver

Correct answer: Clearly disclose the advisory level and document the client's informed decision to proceed

Agents must disclose travel advisories to clients and document their informed consent when clients choose to proceed with travel to high-risk destinations.

Question 24: A client asks about time differences for a trip to New Zealand from Toronto. New Zealand Standard Time (NZST) is approximately how many hours AHEAD of Eastern Standard Time?

13 hours (Correct answer)
8 hours
5 hours
17 hours

Correct answer: 13 hours

New Zealand Standard Time is approximately 17–18 hours ahead of Eastern Standard Time, but during daylight saving, the difference narrows to about 13 hours.

Question 25: A TICO-registered retailer packages and sells a tour assembled entirely by an unregistered foreign wholesaler. Under Ontario Regulation 26/05, the retailer must disclose all of the following to the consumer EXCEPT:

That the tour package supplier is not a TICO registrant
The full legal name of the foreign wholesaler supplying the package
The foreign wholesaler's registration or licence number issued by their home jurisdiction's regulatory authority (Correct answer)
The retailer's own TICO registration number

Correct answer: The foreign wholesaler's registration or licence number issued by their home jurisdiction's regulatory authority

Ontario Regulation 26/05 requires the TICO retailer to disclose their own registration number, the identity of the actual supplier (the foreign wholesaler's name), and the fact that the supplier is not a TICO registrant. However, there is no requirement to obtain or disclose the foreign wholesaler's licence or registration number from their home jurisdiction — that information is neither accessible to the retailer in all cases nor mandated by TICO's regulatory framework.

Question 26: Under the Travel Industry Act, 2002, what must a registered travel agent do if they are unable to provide a travel service that has been paid for?

Provide a full refund to the consumer (Correct answer)
Retain the funds until the service becomes available
Offer a credit toward future travel only
Transfer the booking to another agency without notice

Correct answer: Provide a full refund to the consumer

Registered travel agents are required to provide a full refund to the consumer if they cannot deliver a paid travel service.

Question 27: Under TICO's standards, what must a travel agent disclose regarding travel insurance?

That travel insurance is available, the types of coverage offered, and that the client has the right to review the policy before purchasing (Correct answer)
Travel insurance disclosures are optional and at the agent's discretion
Only the premium amount is required; coverage details need not be disclosed
Only that travel insurance is recommended; the client must research options independently

Correct answer: That travel insurance is available, the types of coverage offered, and that the client has the right to review the policy before purchasing

Agents must proactively inform clients that travel insurance is available, describe the types of coverage, and confirm the client can review the policy before committing.

Question 28: Under the Travel Industry Act, 2002, in which circumstance may the Director order the IMMEDIATE suspension of a registrant's registration WITHOUT first providing an opportunity for a hearing?

When the registrant's errors and omissions insurance lapses for more than 30 consecutive days
When the registrant fails to file their annual return within the prescribed time period
When three or more written consumer complaints have been filed against the registrant within a 12-month period
When the Director is of the opinion that it is in the public interest to do so (Correct answer)

Correct answer: When the Director is of the opinion that it is in the public interest to do so

The Travel Industry Act, 2002 grants the Director the authority to order an immediate suspension without a prior hearing when the Director is of the opinion that it is in the public interest. This is an emergency power designed to protect consumers from imminent harm. In all other circumstances, a registrant must be given the opportunity to be heard before adverse action is taken. The other scenarios listed may eventually lead to regulatory action, but they do not trigger this immediate, no-hearing power.

Question 29: Which of the following best describes the purpose of TICO's trust account requirements?

To ensure travel agencies maintain profitability
To give TICO oversight of agency investment strategies
To simplify tax reporting for travel registrants
To protect consumer funds in the event an agency defaults or closes (Correct answer)

Correct answer: To protect consumer funds in the event an agency defaults or closes

Trust account requirements exist primarily to safeguard consumer funds so travelers are protected if an agency fails before the trip occurs.

Question 30: What is the travel wholesaler's disclosure obligation regarding the terms and conditions of a package they create?

Wholesalers must send terms and conditions directly to each consumer, bypassing the retail agent
Wholesalers have no disclosure obligation since they do not deal directly with consumers
The wholesaler must ensure that all material terms and conditions are provided to retail agents in writing so they can disclose them to consumers (Correct answer)
Wholesalers need only disclose pricing; all other terms are the agent's responsibility

Correct answer: The wholesaler must ensure that all material terms and conditions are provided to retail agents in writing so they can disclose them to consumers

Wholesalers must provide agents with all material terms and conditions in writing so that agents can fulfill their own disclosure obligations to consumers.

Question 31: A TICO-registered agent books a package tour for a client. Which condition related to fuel surcharges must be disclosed on the invoice or accompanying documentation?

That fuel surcharges may be added up to departure and the consumer bears that cost (Correct answer)
That fuel surcharges are capped at 10% of the package price
That fuel surcharges are always included in the quoted price
That fuel surcharges only apply to international flights

Correct answer: That fuel surcharges may be added up to departure and the consumer bears that cost

TICO regulations require registrants to disclose that fuel surcharges or other government-imposed fees may be applied after booking.

Question 32: Which of the following situations would NOT be eligible for a claim against the TICO Travel Industry Compensation Fund?

A customer paid for a cruise with a TICO-registered agency, but the cruise line became insolvent before the trip.
A traveller is left stranded mid-trip because their TICO-registered tour operator went bankrupt.
A traveller is unhappy with the quality of the hotel accommodations provided in their vacation package. (Correct answer)
A consumer paid a TICO-registered retailer for a flight, but the airline ceased operations.

Correct answer: A traveller is unhappy with the quality of the hotel accommodations provided in their vacation package.

The Compensation Fund covers the non-provision of travel services due to bankruptcy or insolvency. It does not cover issues related to the quality or value of the services that were provided.

Question 33: TICO operates as what type of organization under Ontario's regulatory framework?

A federal Crown corporation reporting to Transport Canada
A not-for-profit corporation that is a delegated administrative authority operating under provincial government authority (Correct answer)
A branch of the Ontario Ministry of Tourism, Culture and Sport
A private sector industry association with voluntary membership

Correct answer: A not-for-profit corporation that is a delegated administrative authority operating under provincial government authority

TICO is a not-for-profit corporation designated as a delegated administrative authority by the Ontario government to administer the Travel Industry Act, 2002.

Question 34: Under Ontario Regulation 26/05, which scenario correctly describes when the consumer's right to cancel without penalty arises due to a material change?

When the airline changes the departure time by more than three hours
When the registrant notifies the consumer of a material change before departure (Correct answer)
Only if the price increases by more than 10%
When the consumer changes their mind within 24 hours of booking

Correct answer: When the registrant notifies the consumer of a material change before departure

When a registrant notifies the consumer of a material change, the consumer is entitled to cancel the contract and receive a full refund without penalty.

Question 35: Under TICO's enforcement framework, what is the first step a TICO inspector typically takes when initiating a compliance audit of a registered travel agency?

Provide advance written notice of the inspection to the registrant (Correct answer)
Contact the Ontario Ministry of Consumer Services for approval
Issue a temporary suspension order before entering the premises
Immediately seize all financial records without notice

Correct answer: Provide advance written notice of the inspection to the registrant

TICO inspectors generally provide advance written notice to registrants before conducting compliance audits, though unannounced inspections are permitted in certain circumstances.

Question 36: A travel agency receives a supplier commission rebate into its trust account by mistake. What should the registrant do?

Report the error to TICO within 24 hours and await instructions
Leave it in the trust account as an offset against future client liabilities
Transfer the commission to the operating account promptly after identification (Correct answer)
Apply the amount toward the next client deposit to simplify bookkeeping

Correct answer: Transfer the commission to the operating account promptly after identification

Non-client funds such as commissions must not remain in the trust account; they should be transferred to the operating account as soon as identified.

Question 37: A consumer is seeking reimbursement from the Travel Industry Compensation Fund after the TICO-registered tour operator they booked with went bankrupt. What is the deadline for filing a claim with TICO?

Within 6 months of the tour operator's failure. (Correct answer)
There is no deadline for filing a claim.
Within one year of the scheduled departure date.
Within 30 days of the tour operator's failure.

Correct answer: Within 6 months of the tour operator's failure.

To be eligible for reimbursement from the Compensation Fund, a consumer must file a claim with TICO within 6 months from the date of the failure or closure of the registered travel agency or wholesaler.

Question 38: Under Ontario Regulation 26/05, which records must a travel registrant maintain in their files?

Records are only required for bookings made through global distribution systems (GDS)
Written confirmation of all travel services purchased, trust account records, and records of all complaints received (Correct answer)
Marketing materials and staff scheduling records only
Only receipts for client payments over $1,000

Correct answer: Written confirmation of all travel services purchased, trust account records, and records of all complaints received

Registrants must maintain comprehensive records including booking confirmations, trust account records, and complaint records for a minimum of seven years.

Question 39: What is the significance of the TICO logo displayed in a travel agency window or website?

It confirms the agency is licensed to sell all types of insurance
It certifies that the agency has won a tourism industry award
It shows the agency is a member of ACTA
It indicates the agency is registered with TICO and consumers have certain protections (Correct answer)

Correct answer: It indicates the agency is registered with TICO and consumers have certain protections

The TICO logo signals to consumers that the agency is a registered Ontario travel seller subject to TICO's regulations and consumer protections.

Question 40: A consumer purchases a $9,500 vacation package through a TICO-registered agency. The registered wholesaler becomes insolvent after the consumer paid in full but before any travel occurred. The consumer files a claim with the TICO Travel Industry Compensation Fund. Which scenario would render the consumer's claim INELIGIBLE for Fund compensation?

The travel dates were more than 12 months after the original purchase date
The consumer also holds a valid travel insurance policy that includes supplier default coverage for the same loss
The consumer paid the entire amount by credit card and has already initiated a chargeback with their bank (Correct answer)
The consumer failed to submit their claim within the prescribed 12-month filing period after discovering the loss

Correct answer: The consumer paid the entire amount by credit card and has already initiated a chargeback with their bank

The TICO Compensation Fund operates as a fund of last resort — it will not compensate a consumer if the loss has already been recovered or is recoverable through another source, including a successful credit card chargeback. If the consumer has already recouped their money via chargeback, a duplicate Fund claim for the same loss is ineligible. The other options do not automatically disqualify a claim: travel insurance may have gaps, the 12-month purchase window is not a general eligibility bar, and the filing deadline disqualifies late claims but not those filed within the period.

Question 41: A TICO-registered travel agency holds $4,200 in its trust account on behalf of a consumer who booked an all-inclusive resort package. Under Ontario's Travel Industry Act, 2002, which condition must be satisfied before the agent may release those funds to the resort supplier?

A minimum of 30 days have elapsed since the consumer's initial deposit
The supplier has provided written confirmation that the travel services are secured (Correct answer)
The booking value exceeds $2,500, at which point standard trust rules no longer apply
The consumer has signed a written waiver authorizing early release of funds

Correct answer: The supplier has provided written confirmation that the travel services are secured

Under TICO regulations, consumer funds held in trust may only be released to a supplier once the supplier has confirmed in writing that the travel services have been secured or guaranteed. None of the other options reflect conditions that exist under the Act — the 30-day rule and $2,500 threshold are fabricated, and a consumer waiver cannot override the statutory trust obligation.

Question 42: A TICO-registered travel agency is acquired by a new owner. The new owner wishes to continue operating under the same trade name and with the same staff. Under the Travel Industry Act, 2002, what is the correct regulatory treatment of the existing TICO registration?

The existing registration transfers automatically to the new owner upon completion of the sale, provided the trade name remains unchanged.
The existing registration is void upon change of ownership; the new owner must apply for a new registration before conducting any registrable activity. (Correct answer)
The new owner must notify TICO within 30 days of the acquisition; the registration continues in force during TICO's review period.
The registration remains valid for 90 days post-sale to allow a transition period, after which the new owner must apply for renewal.

Correct answer: The existing registration is void upon change of ownership; the new owner must apply for a new registration before conducting any registrable activity.

Under the Travel Industry Act, 2002, a TICO registration is issued to a specific legal entity or individual and is non-transferable. A change of ownership — whether through asset purchase or share transfer resulting in a new controlling party — voids the existing registration. The new owner must apply for and obtain their own registration before conducting any registrable activity. Operating without a valid registration is an offence under the Act, regardless of the trade name used.

Question 43: Under TICO's trust accounting rules, which of the following statements about interest earned on consumer trust accounts is correct?

Interest must be remitted pro-rata to each consumer whose funds generated it
Interest belongs to the registrant and may be withdrawn to the operating account (Correct answer)
Interest must remain in the trust account until the consumer's travel is completed
Interest must be forwarded quarterly to TICO as part of the consumer compensation fund

Correct answer: Interest belongs to the registrant and may be withdrawn to the operating account

Under the Travel Industry Act framework, interest earned on trust accounts belongs to the registrant, not the consumers. The registrant is permitted to withdraw interest to their operating account. Consumers have no legal claim to trust account interest — their protection lies in the principal being held intact. This is a commonly tested nuance because it appears to conflict with the broader principle that trust funds belong to consumers.

Question 44: A TICO-registered travel agent receives a $4,200 customer deposit via credit card on a Friday afternoon. The credit card processor nets $4,078 to the agency's operating account after deducting a $122 processing fee. Under TICO trust accounting requirements, what amount must be deposited into the trust account, and by when?

$4,200 must be deposited to trust within 3 calendar days of receipt, including weekends
$4,078 (net amount actually received) may be deposited to trust since the processing fee was never in the agency's possession
$4,078 must be deposited to trust, and the $122 fee may be retained in operating funds as earned commission
$4,200 (full gross amount) must be deposited to trust, with the $122 fee recorded as an operating expense, by the close of the next banking day (Correct answer)

Correct answer: $4,200 (full gross amount) must be deposited to trust, with the $122 fee recorded as an operating expense, by the close of the next banking day

TICO requires that the full gross amount received from the customer — not the net amount after processor fees — be treated as trust money. The $122 credit card processing fee is a legitimate operating expense, but it cannot be deducted before the trust deposit; instead, the agency transfers the full $4,200 into trust and recovers the fee through its normal accounting. The deposit must occur by the close of the next banking day after receipt.

Question 45: A travel agent promotes a resort package where the advertised price assumes double occupancy. A solo traveller will pay more. How should this be handled according to TICO standards?

The agent can advertise the double occupancy rate without any disclosure since it is industry standard
The advertisement must clearly disclose that the price is based on double occupancy and that a single supplement applies (Correct answer)
The agent must advertise only the single occupancy rate to avoid confusion
The agent must offer the double occupancy rate to all solo travellers as a courtesy

Correct answer: The advertisement must clearly disclose that the price is based on double occupancy and that a single supplement applies

If a price is based on double occupancy and a single supplement applies, this must be clearly disclosed in the advertisement to avoid misleading single travellers.

Question 46: Which of the following losses would be INELIGIBLE for compensation from the TICO Travel Compensation Fund, even if all other procedural requirements are met?

The full cost of flights and hotel included in a package sold by a TICO-registered agent that became insolvent before departure
Prepayments made to a TICO-registered agent for travel services where the agent ceased operations without delivering the services
A deposit paid to a TICO-registered travel agent for a package holiday, where the agent subsequently became insolvent
Losses arising because an airline included in the consumer's itinerary suspended operations, even though the consumer booked through a TICO-registered agent (Correct answer)

Correct answer: Losses arising because an airline included in the consumer's itinerary suspended operations, even though the consumer booked through a TICO-registered agent

The TICO Compensation Fund compensates consumers for losses caused by the insolvency of a TICO-registered travel agent or wholesale travel agent — it does not cover losses caused by the failure of travel suppliers (airlines, hotels, cruise lines, etc.). If an airline ceases operations, the consumer's claim lies against the airline or through other mechanisms (travel insurance, credit-card chargebacks), not the Compensation Fund, even if the booking was made through a TICO-registered agent.

Question 47: Under Ontario Regulation 26/05, what action may TICO take if a registrant fails to maintain the required trust account?

Refer the matter to the federal Competition Bureau
Impose a provincial sales tax penalty
Suspend or revoke the registrant's certificate of registration (Correct answer)
Issue a public warning only

Correct answer: Suspend or revoke the registrant's certificate of registration

Failure to maintain a required trust account is grounds for TICO to suspend or revoke a registrant's certificate of registration under the Regulation.

Question 48: A registered travel agency maintains a single trust account that earns monthly interest. At month-end, $38 in interest is credited to the account. The agency's compliance officer must decide how to treat this interest. Which treatment is correct under Ontario's Travel Industry Act, 2002 framework?

The interest must remain in the trust account and can only be withdrawn when the account balance drops below the required minimum threshold
The interest must be remitted to TICO's consumer protection fund on a quarterly basis
The interest must remain in trust indefinitely and be distributed proportionally to all clients whose funds were on deposit during the month
The interest may be withdrawn from the trust account and credited to the agency's operating account, provided trust account records accurately reflect the withdrawal (Correct answer)

Correct answer: The interest may be withdrawn from the trust account and credited to the agency's operating account, provided trust account records accurately reflect the withdrawal

Under Ontario's travel industry regulations, interest earned on a registrant's trust account belongs to the registrant — not to the clients whose funds generated the interest. However, the agency must properly document the withdrawal to ensure trust account records remain accurate and reconcile correctly. The interest cannot be co-mingled without documentation, but it is permissible to withdraw it to operating funds with proper record-keeping. The other options reflect misunderstandings of the regulatory framework.

Question 49: Which of the following actions can the Discipline Committee take if it finds a TICO registrant guilty of misconduct?

Require the registrant to successfully complete educational courses. (Correct answer)
Sentence the individual owner to a term of imprisonment.
Order the registrant to pay restitution to all affected clients.
Order the registrant's business to be sold to another TICO registrant.

Correct answer: Require the registrant to successfully complete educational courses.

Under Section 16 of the Travel Industry Act, 2002, the Discipline Committee has the authority to make various orders, including directing a registrant to complete educational courses, imposing fines, or suspending registration. Imprisonment is a penalty that can only be imposed by a court following a conviction for an offence under the Act.

Question 50: Under the Regulations to the Travel Industry Act, 2002, when must a registered travel agent include their TICO registration number in advertising?

Only when the advertisement includes specific pricing or fare quotes
In all advertisements directed at the public, regardless of medium or format (Correct answer)
Only in written and digital advertisements — oral advertisements such as radio spots are excluded
Only when the advertisement promotes a travel product from a registered travel wholesaler

Correct answer: In all advertisements directed at the public, regardless of medium or format

The Regulations under the Travel Industry Act, 2002 require that a registrant's TICO registration number appear in ALL advertising directed at the public, without exception for format or medium. This applies to print, digital, broadcast, and any other channel. The requirement exists so consumers can verify the legitimacy of the seller before purchasing. There is no pricing threshold or medium-based carve-out; the obligation is unconditional.

Question 51: A new travel agency in Ontario is creating its first website. According to Section 31 of Ontario Regulation 26/05, which of the following pieces of information MUST be included on the main page of the website?

The date the agency was first established.
The personal home phone numbers of the travel counsellors.
A list of the top 10 vacation packages sold.
The agency's business name, address, and TICO registration number. (Correct answer)

Correct answer: The agency's business name, address, and TICO registration number.

Section 31 of the regulation requires that any representation, which includes a website, must clearly state the registrant's business name, address, and registration number. This ensures consumers can identify and verify the legitimacy of the agency.

Question 52: An Ontario consumer learns on March 1 that her travel agency has ceased operations. She is uncertain whether it has formally declared insolvency. She finally files a Compensation Fund claim on June 3 of the same year. TICO denies the claim as time-barred. Why is TICO's position most likely correct?

Claims must be filed within 90 days of the date the consumer knew or ought to have known of the loss, which elapsed before June 3 (Correct answer)
Claims must be filed within 60 days of the registrant's formal notice of insolvency published in the Ontario Gazette
Claims must be filed within 90 days of the originally scheduled travel departure date
Claims must be filed within 30 days of the date the registrant's licence is formally revoked by TICO

Correct answer: Claims must be filed within 90 days of the date the consumer knew or ought to have known of the loss, which elapsed before June 3

The deadline to file a Compensation Fund claim is 90 days from the date the consumer knew or ought to have known about the loss — not from formal legal insolvency proceedings, licence revocation, or the travel date. If the consumer became aware on March 1 that the agency had ceased operations, the 90-day window expires around May 30. Filing on June 3 misses that deadline, giving TICO proper grounds to deny the claim.

Question 53: A travel agency places a print advertisement on Monday showing a Caribbean cruise package at '$1,149 per person.' On Wednesday—before any bookings are made—the cruise line announces a mandatory port fee increase raising the true cost to $1,219. The ad runs unchanged through Sunday. Which statement best describes the registrant's obligation under TICO advertising standards?

The registrant must honour the $1,149 price for any consumer who presents the printed ad, regardless of the supplier's increase.
The registrant must add a disclosure footnote to future runs of the ad but is not required to withdraw existing placements already paid for.
The registrant must immediately pull or correct the advertisement, as continuing to display a price the registrant knows cannot be honoured constitutes misleading advertising. (Correct answer)
The registrant may continue running the ad because the price change occurred after the ad was placed and is attributable to a third-party supplier.

Correct answer: The registrant must immediately pull or correct the advertisement, as continuing to display a price the registrant knows cannot be honoured constitutes misleading advertising.

TICO's Code of Ethics and Ontario's Consumer Protection Act prohibit registrants from advertising prices they know cannot be honoured. Once the registrant becomes aware the advertised price is no longer accurate, the obligation to correct or withdraw the advertisement is immediate—regardless of who caused the price change or when the ad was originally placed. Blaming the supplier does not absolve the registrant of responsibility for their own advertising.

Question 54: A client books a cruise and pays a deposit. The invoice states that deposits are non-refundable. If the consumer cancels before the balance due date, can the agency retain the deposit under TICO's standards?

No — all deposits are fully refundable until 60 days before departure under Ontario law
No — consumers always have the right to a full refund of deposits regardless of disclosed conditions
Yes, if the non-refundable deposit condition was clearly disclosed in writing before the consumer paid the deposit (Correct answer)
Yes, but only if the deposit amount is less than 10% of the total package price

Correct answer: Yes, if the non-refundable deposit condition was clearly disclosed in writing before the consumer paid the deposit

Non-refundable deposit conditions are enforceable if they were clearly disclosed in writing before the consumer made the deposit. Disclosure before payment is the key requirement.

Question 55: TICO's Board of Directors is composed of representatives from which groups?

Both travel industry representatives and consumer representatives (Correct answer)
Only government-appointed consumer advocates
Only travel industry professionals
Only TICO staff and government officials

Correct answer: Both travel industry representatives and consumer representatives

TICO's Board includes both industry representatives (travel agents and wholesalers) and consumer representatives, balancing industry and public interests.

Question 56: Under the Ontario Travel Industry Act, 2002, a supplier notifies a TICO-registered agent that the total price of a consumer's confirmed package has increased by 9% due to fuel surcharge adjustments, 45 days before departure. What is the registrant's primary obligation to the consumer in this situation?

The registrant must notify the consumer of the increase; if the increase exceeds the prescribed threshold, the consumer has the right to cancel for a full refund (Correct answer)
The registrant must renegotiate with the supplier to bring the increase under 7% before informing the consumer
The registrant must absorb the full price increase internally, since fuel surcharges are an industry risk that agents must account for
The registrant may apply the increase without consumer consent, provided the original contract contained a general price-variation clause

Correct answer: The registrant must notify the consumer of the increase; if the increase exceeds the prescribed threshold, the consumer has the right to cancel for a full refund

Ontario regulations require registrants to promptly notify consumers of supplier-initiated price increases. If the increase exceeds the threshold prescribed in regulation (7% of the total package price), the consumer has the right to cancel the booking and receive a full refund — even this close to departure. Simply including a general price-variation clause in the contract does not override the consumer's statutory right to cancel when the increase is material.

Question 57: If a consumer has a complaint about an Ontario-registered travel agent, what is the correct first step?

Notify Transport Canada of the dispute
Contact the travel agent or agency to resolve the matter first (Correct answer)
File a complaint directly with the Ontario Small Claims Court
Immediately report the agent to the RCMP

Correct answer: Contact the travel agent or agency to resolve the matter first

TICO's complaint process typically requires consumers to first attempt to resolve the issue directly with the registrant before escalating to TICO.

Question 58: Which South American country requires Canadian citizens to obtain a visa BEFORE travelling?

Argentina
Bolivia (Correct answer)
Colombia
Brazil

Correct answer: Bolivia

Bolivia requires Canadian citizens to obtain a visa prior to arrival, unlike many other South American countries that allow visa-free access.

Question 59: Under TICO regulations, what is the maximum amount a single consumer can claim from the Travel Compensation Fund?

$7,500
$10,000 (Correct answer)
$15,000
$5,000

Correct answer: $10,000

The Travel Compensation Fund caps individual consumer claims at $10,000 per person.

Question 60: A consumer prepaid a Caribbean cruise package through a TICO-registered travel agency. One week before departure, the cruise line (not a TICO registrant) declares bankruptcy and cancels all sailings. The travel agency itself remains solvent and open. Which statement best describes the consumer's recourse under O. Reg. 26/05?

The consumer may file a claim against the TICO Travel Industry Compensation Fund only if the agency also becomes insolvent within 12 months
The consumer has no claim against the TICO Compensation Fund because the loss arose from a travel supplier failure, not a TICO-registered registrant failure (Correct answer)
The consumer is fully protected because the agency was required to hold the cruise funds in trust until the sailing date
The consumer may file a claim against the TICO Travel Industry Compensation Fund because a prepaid travel service was not delivered

Correct answer: The consumer has no claim against the TICO Compensation Fund because the loss arose from a travel supplier failure, not a TICO-registered registrant failure

The TICO Travel Industry Compensation Fund is specifically designed to compensate consumers who suffer losses caused by the failure of a TICO-registered travel agent or wholesaler. It does NOT cover losses arising from a travel supplier (airline, cruise line, hotel, etc.) going bankrupt. In this scenario the agency is solvent — the loss flows from the cruise line's insolvency, which falls outside the Fund's mandate. The consumer's remedy would be through travel insurance, credit card chargebacks, or the cruise line's own bankruptcy proceedings.

Question 61: An individual holds a valid TICO registration as a travel agent and wishes to simultaneously operate as an independent contractor selling travel under two different host agency agreements. What registration requirement applies?

The individual may work under both host agencies using their single registration, provided both host agencies are TICO-registered (Correct answer)
Working under two host agencies simultaneously is prohibited under TICO regulations regardless of registration status
A separate registration is required for each host agency relationship, as each constitutes a distinct registrant-principal relationship
The individual must designate one primary host agency with TICO and may subcontract the second relationship informally

Correct answer: The individual may work under both host agencies using their single registration, provided both host agencies are TICO-registered

A registered travel agent may work as an independent contractor under multiple TICO-registered host agencies simultaneously using their single individual registration. The key requirement is that all host agencies involved must themselves hold valid TICO registration. The agent's own registration covers their activities conducted under any TICO-registered seller.

Question 62: The TICO Registrar is reviewing the registration renewal of a travel agent who, two years ago, was convicted outside Canada of an offence that, if committed in Ontario, would constitute fraud under the Criminal Code. The registrant argues the foreign conviction is irrelevant to Ontario registration. Under the Travel Industry Act, 2002, which statement is MOST accurate regarding the Registrar's authority?

The Registrar may consider the foreign conviction as a ground to refuse renewal if the equivalent Ontario offence involves fraud, dishonesty, or misrepresentation. (Correct answer)
The Registrar may deny renewal only if the foreign jurisdiction's court issued a finding equivalent to an Ontario indictable offence conviction.
The Registrar has no authority to consider foreign convictions; only Ontario or Canadian criminal convictions are relevant to registration decisions.
The Registrar must accept the renewal automatically because the conviction predates the current registration period.

Correct answer: The Registrar may consider the foreign conviction as a ground to refuse renewal if the equivalent Ontario offence involves fraud, dishonesty, or misrepresentation.

Under the Travel Industry Act, 2002, the Registrar has broad discretion to refuse or decline to renew registration if the applicant or registrant has been convicted of an offence that, in the Registrar's opinion, is relevant to their fitness to carry on the business—including offences committed outside Canada that are equivalent to fraud, dishonesty, or misrepresentation under Ontario or Canadian law. The Act does not restrict this consideration to domestic convictions. The timing of the conviction relative to the registration period is not a shield; the Registrar assesses ongoing fitness.

Question 63: An Ontario consumer books a flight directly through an international airline's website. The airline subsequently goes bankrupt and the consumer loses their fare. Under TICO's mandate, which of the following statements is most accurate?

TICO will investigate the airline and pursue restitution on the consumer's behalf through the courts
The consumer is entitled to compensation up to $5,000 from TICO because the loss occurred during travel from Ontario
TICO's Compensation Fund will cover the full loss because the flight originated from an Ontario airport
TICO has no jurisdiction because the airline is not a registrant under the Travel Industry Act, 2002, and the consumer did not book through a registered Ontario travel agent (Correct answer)

Correct answer: TICO has no jurisdiction because the airline is not a registrant under the Travel Industry Act, 2002, and the consumer did not book through a registered Ontario travel agent

TICO's Compensation Fund and consumer protection provisions apply only to transactions made through TICO-registered Ontario travel agents and wholesalers. Airlines are federally regulated and are not TICO registrants. When a consumer books directly with an airline — bypassing a registered agent — TICO has no mandate or mechanism to intervene or compensate.

Question 64: The Travel Compensation Fund (TCF) covers losses arising from which specific event?

A travel supplier (e.g., airline or hotel) going bankrupt, even if the agent is solvent
Injuries or medical emergencies experienced during travel
Travel disruptions caused by natural disasters or political instability
The financial insolvency of a TICO-registered travel agent or travel wholesaler (Correct answer)

Correct answer: The financial insolvency of a TICO-registered travel agent or travel wholesaler

The TCF specifically covers losses arising from the financial insolvency of a TICO-registered travel agent or wholesaler — not supplier bankruptcies or travel disruptions.

Question 65: A TICO registrant self-discloses a compliance breach to TICO before it is discovered during an audit. How does TICO typically treat voluntary self-disclosure?

Self-disclosure results in automatic registration revocation
Self-disclosure has no impact on the enforcement outcome
TICO is required by law to impose maximum penalties regardless of disclosure
Voluntary disclosure may be considered a mitigating factor in determining penalties (Correct answer)

Correct answer: Voluntary disclosure may be considered a mitigating factor in determining penalties

Voluntary self-disclosure of compliance issues is generally viewed as a mitigating factor by TICO, potentially resulting in reduced penalties compared to violations discovered through audit.

Question 66: A Toronto travel agency advertises a flight-and-hotel package online with a headline price of $699 per person. The fine print reveals this price excludes airport improvement fees ($55), fuel surcharges ($120), and a seat selection fee ($40) marked as 'optional.' A TICO compliance officer reviews the advertisement. Which aspect of this pricing presentation most directly violates Ontario's advertising standards for travel registrants?

The fuel surcharges and airport improvement fees, because all mandatory, unavoidable charges must be incorporated into the advertised price (Correct answer)
The online format, because travel packages exceeding $500 must be advertised with a price disclosure box in a regulated font size
The seat selection fee, because optional fees must always be included in the headline price regardless of consumer choice
The per-person qualifier, because package pricing must be displayed as a total for double occupancy

Correct answer: The fuel surcharges and airport improvement fees, because all mandatory, unavoidable charges must be incorporated into the advertised price

TICO's advertising standards, consistent with Ontario Consumer Protection Act principles and TICO's own Code of Ethics, require that all mandatory, unavoidable charges be included in the headline advertised price. Airport improvement fees and fuel surcharges are non-optional — every consumer purchasing the product must pay them — so burying them in fine print constitutes misleading pricing. Optional fees like seat selection may be disclosed separately because a consumer can genuinely avoid them. The per-person display format and online medium requirements listed in the other options are not violations as described.

Question 67: Under the Travel Industry Act, 2002, which of the following businesses is required to be registered as a travel wholesaler?

A car rental company that offers vehicles to business travellers in Ontario
A company that creates and sells vacation packages in Ontario to retail travel agents for resale to consumers (Correct answer)
A hotel chain that sells rooms directly to consumers via its own website
An airline that sells flights directly to the public through airport ticket counters

Correct answer: A company that creates and sells vacation packages in Ontario to retail travel agents for resale to consumers

A company that creates packages and sells them to retail agents for resale must register as a travel wholesaler under the Travel Industry Act, 2002.

Question 68: The Registrar proposes to refuse renewal of a travel agent's registration under the Travel Industry Act, 2002. The travel agent disputes the proposal. Which statement most accurately describes the agent's legal position while the matter is being resolved?

The agent may continue operating only if the Registrar grants a temporary licence pending the hearing.
The agent must immediately cease carrying on business as a travel agent upon receiving the Registrar's proposal.
The agent may continue to operate as a travel agent until the matter is finally determined, provided they request a hearing before the Licence Appeal Tribunal. (Correct answer)
The agent must cease operations within 15 days of the proposal unless a court injunction is obtained.

Correct answer: The agent may continue to operate as a travel agent until the matter is finally determined, provided they request a hearing before the Licence Appeal Tribunal.

Under the Travel Industry Act, 2002, if the Registrar proposes to refuse renewal and the registrant requests a hearing before the Licence Appeal Tribunal, the registrant is entitled to continue carrying on business as if the registration had been renewed until the matter is finally determined. This protection prevents an automatic cessation of business during a disputed administrative proceeding.

Question 69: A registered Ontario travel agent collects $4,200 from a client for a vacation package and holds it in trust. The travel wholesaler supplying the package is NOT registered under the Travel Industry Act, 2002. Which statement correctly describes the agent's obligation regarding those trust funds?

The agent must obtain written approval from the TICO Registrar before releasing funds to any wholesaler, registered or not.
The agent may release the funds immediately provided the client has signed a waiver acknowledging the wholesaler's unregistered status.
The agent must retain the funds in trust until after the travel services have been completed and may not release them early to an unregistered supplier. (Correct answer)
The agent may release the funds to the unregistered wholesaler once the client's departure is within 30 days.

Correct answer: The agent must retain the funds in trust until after the travel services have been completed and may not release them early to an unregistered supplier.

Under the Travel Industry Act, 2002 and its regulations, a travel agent may release trust funds before completion of travel services only when paying a registrant (i.e., a registered travel wholesaler). When the supplier is unregistered, the agent has no early-release option and must hold the funds in trust until the travel services are actually completed. Releasing funds early to an unregistered wholesaler would expose the agent to liability and potential disciplinary action.

Question 70: A client is purchasing a complex vacation package from a travel agent. The package was created by a TICO-registered wholesaler. According to Section 36 of Ontario Regulation 26/05, what information about the wholesaler must the agent disclose to the client before accepting payment?

The wholesaler's preferred airline and hotel chain partners.
The names of the wholesaler's senior management team.
The number of years the wholesaler has been in business.
The wholesaler's business name, address, and TICO registration number. (Correct answer)

Correct answer: The wholesaler's business name, address, and TICO registration number.

Section 36(1)(e) of the Regulation requires the travel agent to disclose the business name, address, and registration number of any other registrant (in this case, the wholesaler) who will be supplying the travel services purchased by the customer.

Question 71: Which of the following best describes the purpose of the TICO Registration Education Program (REP)?

To ensure prospective registrants understand their obligations under Ontario travel law (Correct answer)
To provide marketing certification for travel agents selling luxury packages
To train registrants in GDS booking systems
To certify travel agents in international destination knowledge

Correct answer: To ensure prospective registrants understand their obligations under Ontario travel law

The REP is designed to educate future registrants about their legal and regulatory responsibilities under Ontario's Travel Industry Act.

Question 72: TICO conducts a compliance audit and discovers that a registrant's trust account balance is $8,000 less than the total of outstanding consumer deposits on record. The registrant claims the shortfall arose because a supplier invoiced unexpectedly and the registrant made an early remittance before collecting the full balance from consumers. Which legal principle does this scenario most directly violate?

The requirement to deposit consumer funds within two banking days
The prohibition on remitting supplier payments before receiving full consumer payment (Correct answer)
The requirement to maintain trust account records for a minimum of six years
The prohibition on accepting consumer payments by personal cheque

Correct answer: The prohibition on remitting supplier payments before receiving full consumer payment

A registrant may only release funds from trust to a supplier to the extent that the consumer has already paid for that travel service. Remitting more to the supplier than has been collected from the consumer creates a trust deficiency — the account holds less than what is owed to consumers. This is a direct violation of the trust integrity rules, as it effectively means the registrant is using other consumers' funds or their own operating funds in reverse. A trust deficiency triggers serious regulatory consequences regardless of the registrant's good faith explanation.

Question 73: A TICO registrant operating as a sole proprietor dies unexpectedly. Their spouse, who is not TICO-registered, wishes to continue operating the travel agency to wind down existing bookings and fulfil outstanding client obligations. Under TICO regulations, what is the correct course of action?

The spouse must immediately cease all travel sales activity and apply for their own registration before conducting any transactions
The estate's executor may apply to TICO for a temporary estate registration to allow an orderly wind-down under supervised conditions (Correct answer)
A surviving family member may continue limited operations — restricted to fulfilling pre-existing bookings only — without separate registration for 30 days
The spouse may operate the agency for up to 60 days under the deceased's registration while estate matters are resolved

Correct answer: The estate's executor may apply to TICO for a temporary estate registration to allow an orderly wind-down under supervised conditions

TICO's framework provides a mechanism for the estate of a deceased registrant: the executor or administrator may apply for a temporary registration on behalf of the estate to allow an orderly continuation or wind-down of the business. This prevents stranded consumers while ensuring regulatory oversight continues. The spouse or any unregistered individual cannot simply continue operations under the deceased's personal registration, as that registration extinguishes upon death.

Question 74: Under Ontario Regulation 26/05, which of the following must appear on a travel booking invoice provided to the consumer?

The names of all travellers, total price including all taxes and fees, a description of all services, and cancellation and refund conditions (Correct answer)
Only the total price and departure date
The agent's personal cell phone number and the IATA airline code
A federal GST/HST registration number for each travel supplier

Correct answer: The names of all travellers, total price including all taxes and fees, a description of all services, and cancellation and refund conditions

Ontario Regulation 26/05 specifies comprehensive requirements for what must be included on a travel invoice, including traveller names, all-inclusive pricing, service descriptions, and cancellation conditions.

Question 75: A travel agent's TICO registration is revoked following a disciplinary hearing. Under Ontario Regulation 26/05, what is the registrant's obligation regarding consumer transaction records after the revocation takes effect?

Records must be surrendered to TICO immediately upon revocation and the former registrant retains no copies
Records must be retained for two years post-revocation, after which they may be destroyed
Records must be retained by the former registrant for a minimum of seven years from the date each transaction was completed (Correct answer)
No retention obligation exists after revocation because the Act only applies to active registrants

Correct answer: Records must be retained by the former registrant for a minimum of seven years from the date each transaction was completed

O. Reg. 26/05 requires registrants — and former registrants — to retain transaction records for seven years from the date of each transaction. The obligation does not terminate upon revocation, expiry, or cancellation of registration. A former registrant who destroys records before the seven-year window closes is in breach of the regulation and may face additional liability.

Question 76: A travel retailer's email promotion states a package price of $1,299 but a mandatory destination fee of $150 is listed only in fine print at the bottom. Under TICO pricing standards, this practice is:

Non-compliant because mandatory fees must be included in the prominently stated price (Correct answer)
Compliant if the fine print is legible on a standard screen
Compliant since the fee is technically disclosed somewhere in the email
Non-compliant only if the consumer actually paid without noticing the fee

Correct answer: Non-compliant because mandatory fees must be included in the prominently stated price

TICO requires mandatory fees to be incorporated into the prominently displayed price, not buried in fine print.

Question 77: A client books a cruise departing from Barcelona that includes a port call in Ceuta. The client asks whether they will need to go through customs when the ship docks there. What is the most accurate advice a TICO-registered travel agent should provide?

Ceuta is a Moroccan territory administered by Spain, so Moroccan entry requirements apply at the port.
Ceuta is a full member of the European Union customs union, so no customs formalities are required for EU passport holders.
Ceuta follows the same customs rules as mainland Spain in all respects, including VAT and import allowances.
Ceuta is a Spanish autonomous city on the northern coast of Africa and is NOT part of the EU customs territory, so customs procedures may apply depending on what passengers bring ashore. (Correct answer)

Correct answer: Ceuta is a Spanish autonomous city on the northern coast of Africa and is NOT part of the EU customs territory, so customs procedures may apply depending on what passengers bring ashore.

Ceuta is a Spanish autonomous city located on the north African coast but is explicitly excluded from the EU customs territory (though it is part of the EU politically). This means duty-free allowances and customs rules differ from mainland Spain, and passengers may face customs scrutiny when returning items to the ship. This is an advanced nuance that affects traveller purchasing decisions ashore.

Question 78: Under what general standard can TICO refuse to grant registration to an applicant?

Only if the applicant has prior travel industry complaints on record
Only if the applicant has been convicted of criminal fraud
If the applicant has previously operated in another Canadian province
If the applicant is not fit and proper to carry on business as a registrant (Correct answer)

Correct answer: If the applicant is not fit and proper to carry on business as a registrant

TICO may refuse registration if an applicant is not considered fit and proper to carry on business, a broad standard covering character, financial standing, and competence.

Question 79: A travel agent's registration is suspended by the TICO Registrar. During the suspension, the agent may:

Take no bookings and make no representations as a travel agent during the suspension period (Correct answer)
Continue taking bookings but must disclose the suspension to all new clients
Continue working under a colleague's registration number during the suspension
Appeal to the courts to obtain a stay of suspension allowing them to continue working

Correct answer: Take no bookings and make no representations as a travel agent during the suspension period

During a suspension, the agent cannot carry on the business of a travel agent. Taking new bookings or representing themselves as a travel agent is prohibited.

Question 80: The Travel Industry Act, 2002 requires registrants to carry Errors and Omissions (E&O) insurance. What is the primary purpose of this insurance?

To protect consumers from financial losses arising from mistakes or negligence by the travel agent (Correct answer)
To insure the registrant's own business assets against theft or fire
To pay TICO's administrative costs when the agent makes a filing error
To cover the travel agent's liability for injuries sustained by clients during travel

Correct answer: To protect consumers from financial losses arising from mistakes or negligence by the travel agent

E&O insurance protects consumers and clients from financial losses caused by the agent's professional errors or negligence.

Question 81: A TICO-registered travel agent's trust account currently holds consumer funds for upcoming bookings. Which of the following represents a PERMISSIBLE withdrawal from that trust account under O. Reg. 26/05?

Transferring funds to cover the agency's monthly payroll when operating cash flow is insufficient
Remitting payment in full to a licensed wholesaler for travel services already booked on behalf of the consumer (Correct answer)
Using funds temporarily to pay the agency's TICO registration renewal fee, with intent to replenish within 30 days
Withdrawing an amount equal to the agency's earned commission before the consumer has travelled

Correct answer: Remitting payment in full to a licensed wholesaler for travel services already booked on behalf of the consumer

Trust account funds may only be withdrawn for purposes expressly permitted by the regulation — primarily to pay a supplier (wholesaler, airline, hotel, etc.) for travel services booked on the consumer's behalf, or to refund the consumer. Withdrawing commissions before travel is completed, covering operating expenses, or making 'temporary' withdrawals for licensing fees are all prohibited and constitute misappropriation of trust funds.

Question 82: A consumer purchases a cruise from a TICO-registered travel agency. The cruise line unexpectedly declares bankruptcy and ceases operations before the trip. Under the Ontario Travel Industry Compensation Fund, what is the maximum amount the consumer can typically claim?

Up to $5,000 per person. (Correct answer)
Up to $10,000 per person.
Nothing, because the failure was by an end supplier (the cruise line).
The full cost of the trip, regardless of the amount.

Correct answer: Up to $5,000 per person.

The Ontario Travel Industry Compensation Fund provides reimbursement for travel services not received due to the failure of a registered travel agency, wholesaler, or an end supplier like a cruise line or airline. The maximum claim is up to $5,000 per person.

Question 83: Under the Travel Industry Act, 2002, which individual is required to be registered with TICO?

A person who sells travel services to the public from an Ontario office for compensation (Correct answer)
A Canadian citizen who books personal travel online through a foreign website
A federal government employee who arranges employee travel for government use only
An Ontario resident who occasionally recommends hotels to friends without payment

Correct answer: A person who sells travel services to the public from an Ontario office for compensation

Any person or business that sells travel services to the public in Ontario for compensation must be registered with TICO under the Travel Industry Act, 2002.

Question 84: Under Ontario Regulation 26/05, which of the following situations would allow a registrant to lawfully withdraw funds from its trust account WITHOUT first providing travel services or issuing a refund?

The registrant is transferring the funds to another registered travel agent who is taking over the consumer's file
The registrant is remitting the funds directly to a registered supplier in accordance with the supplier's payment schedule (Correct answer)
The consumer has verbally agreed to allow the registrant to hold the funds in its general operating account
The consumer has signed a waiver acknowledging that the registrant may access trust funds at any time

Correct answer: The registrant is remitting the funds directly to a registered supplier in accordance with the supplier's payment schedule

O. Reg. 26/05 specifies that trust money may be withdrawn to remit to a supplier, to refund the consumer, or to take earned commission after travel services are provided. Remitting funds to a supplier on behalf of the consumer is an explicitly permitted withdrawal reason. A consumer waiver, verbal consent, or file transfer to another agent does not create an independent right to remove trust funds — the regulation's permitted withdrawal reasons are exhaustive.

Question 85: Ontario Regulation 26/05 defines a 'material change' to include which of the following?

A change in the assigned seat on the aircraft
A minor schedule adjustment of less than one hour
A change in the destination country (Correct answer)
A change in the in-flight meal service

Correct answer: A change in the destination country

A change in the destination country is a significant alteration to the travel product and qualifies as a material change under the Regulation.

Question 86: What is the purpose of the Travel Industry Compensation Fund administered under the Travel Industry Act, 2002?

To fund marketing campaigns for Ontario travel agents
To reimburse travel agents for business losses
To pay TICO staff salaries
To compensate consumers who suffer financial loss due to a registrant's bankruptcy or fraud (Correct answer)

Correct answer: To compensate consumers who suffer financial loss due to a registrant's bankruptcy or fraud

The Compensation Fund protects consumers by reimbursing them for financial losses caused by a registered travel agent's insolvency or fraudulent conduct.

Question 87: A client books a tour directly with a tour operator based outside of Ontario and pays them for the travel services. The tour operator subsequently goes bankrupt. The client contacts their Ontario-based travel agent for help. Can the client make a claim to the TICO Compensation Fund?

Yes, because their travel agent is registered in Ontario.
Yes, because the client is a resident of Ontario.
No, because the travel services were not purchased from a TICO-registered travel agency. (Correct answer)
No, because the Fund only covers airline and cruise line failures.

Correct answer: No, because the travel services were not purchased from a TICO-registered travel agency.

To be eligible for protection under the Compensation Fund, the consumer must have purchased their travel services from a TICO-registered travel agency in Ontario. Booking directly with an out-of-province supplier, even if you are an Ontario resident or have a relationship with an Ontario agent, makes the purchase ineligible.

Question 88: A consumer cancels a trip 48 hours before departure. The travel agent says no refund is available. Under the Travel Industry Act, 2002, what must the agent provide?

Nothing — verbal communication is sufficient
A future travel credit of equal value
A written explanation of why no refund is available under the contract terms (Correct answer)
A full refund regardless of timing

Correct answer: A written explanation of why no refund is available under the contract terms

Even when a refund is not owed, the agent must provide a written explanation citing the specific contract terms that apply.

Question 89: If a travel agency operates three branch locations in Ontario, how must those locations be registered with TICO?

Each branch location must hold its own separate TICO registration (Correct answer)
Branches require registration only if they employ more than three agents
Only the head office needs to be registered on behalf of all branches
A single registration automatically covers all branch locations

Correct answer: Each branch location must hold its own separate TICO registration

Each branch location of a travel agency must be separately registered with TICO, as registration is location-specific.

Question 90: How is a 'travel wholesaler' best described under TICO's regulatory framework?

A person who assembles travel services and sells them to travel agents for resale to consumers (Correct answer)
A person who sells travel services directly to the public at discounted wholesale prices
A business that purchases airline seats in bulk and sells them directly to the public
A travel agent who is licensed to operate in multiple provinces simultaneously

Correct answer: A person who assembles travel services and sells them to travel agents for resale to consumers

A travel wholesaler assembles travel packages and sells them to registered travel agents who then resell to consumers — they do not typically sell directly to the public.

Question 91: Under TICO's framework, which of the following best describes the relationship between a registered travel agency and its supervisor/manager designation?

Supervisors are optional for agencies with fewer than five staff members
Every registered travel agency must have at least one TICO-certified supervisor or manager responsible for the location (Correct answer)
Any senior staff member can act as a supervisor without TICO certification
The supervisor role only applies to agencies operating in more than one location

Correct answer: Every registered travel agency must have at least one TICO-certified supervisor or manager responsible for the location

Every registered travel agency location must have at least one TICO-certified supervisor or manager who is responsible and accountable for the compliance of that location. This requirement ensures there is always a qualified person overseeing regulatory obligations.

Question 92: 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:

Compliant, because the additional charges are disclosed somewhere within the advertisement.
Non-compliant, because all-inclusive pricing — including taxes and mandatory fees — must be prominently stated as a single total price. (Correct answer)
Non-compliant only if the advertisement appears in a digital format rather than print.
Compliant, provided the fine print is legible and in the same document as the advertised price.

Correct 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.

Question 93: A travel agency is winding down operations. Under TICO requirements, what must happen to the funds remaining in the trust account?

They may be retained by the agency owner as final revenue
They must be donated to a registered charity within 60 days
They revert to TICO's consumer protection fund automatically
They must be refunded to clients or remitted to suppliers as applicable (Correct answer)

Correct answer: They must be refunded to clients or remitted to suppliers as applicable

Upon closure, all trust funds must be properly disposed of by refunding clients or paying suppliers — they cannot be kept by the agency.

Question 94: An agent's designated trust account earns interest. Under Ontario Regulation 26/05, how must this interest be treated?

Interest on trust accounts belongs entirely to the travel agency as operating income
Interest must be returned to clients proportionally based on the number of days their funds were held
The Regulation specifies how trust account interest must be handled; agents must follow the current rules to determine whether interest belongs to the agency or must be credited to clients (Correct answer)
All interest must be immediately transferred to the Travel Compensation Fund

Correct answer: The Regulation specifies how trust account interest must be handled; agents must follow the current rules to determine whether interest belongs to the agency or must be credited to clients

Ontario Regulation 26/05 addresses how trust account interest must be treated. Agents must comply with the current rules, which specify the permissible uses of trust account interest.

Question 95: A corporation purchases 10 employee reward travel packages totalling $35,000 from a TICO-registered wholesaler. The wholesaler subsequently becomes insolvent. The corporation files a TCF claim. Which of the following most accurately describes its eligibility?

The corporation is not eligible because the TCF is designed to protect individual consumers, not corporate purchasers acquiring travel for business purposes (Correct answer)
The corporation may claim up to $5,000 per employee package, for a maximum of $50,000
The corporation may claim up to $5,000 as a single claimant, since all packages were on one booking
The corporation is eligible for the same per-person limits as individual consumers if it can identify each traveling employee by name

Correct answer: The corporation is not eligible because the TCF is designed to protect individual consumers, not corporate purchasers acquiring travel for business purposes

The Travel Compensation Fund is designed to protect individual consumers — private persons who purchase travel services for personal or leisure use. When a corporation acquires travel as a business expense or commercial transaction (such as employee incentive travel), it does not qualify as a 'consumer' under the Travel Industry Act, 2002, and is therefore not eligible to make a TCF claim.

Question 96: A consumer's invoice shows a package price in US dollars, but the consumer lives in Ontario. What is the TICO-registered agent's obligation?

No disclosure is needed because consumers are expected to know currency differences
Clearly disclose the currency on the invoice and advise the consumer of the applicable exchange rate or method of conversion (Correct answer)
Always convert the price to Canadian dollars before issuing any invoice
Only disclose currency if the consumer specifically asks

Correct answer: Clearly disclose the currency on the invoice and advise the consumer of the applicable exchange rate or method of conversion

TICO requires clear currency identification on invoices so consumers understand their actual financial obligations.

Question 97: A TICO-registered travel wholesaler has its registration revoked by the Registrar following an audit. The wholesaler immediately files a notice of appeal to the Licence Appeal Tribunal. What is the effect of filing the appeal on the wholesaler's ability to continue operating?

The revocation is automatically stayed upon filing the appeal, and the wholesaler may continue operating until the Tribunal issues its final decision.
The wholesaler must cease operations immediately upon revocation and cannot apply for a stay under any circumstances.
The appeal automatically stays the revocation for 30 days, after which a stay must be sought from the Tribunal.
The wholesaler may continue operating only if the Tribunal grants a specific stay of the revocation order upon application by the wholesaler. (Correct answer)

Correct answer: The wholesaler may continue operating only if the Tribunal grants a specific stay of the revocation order upon application by the wholesaler.

Under the Travel Industry Act, 2002, filing a notice of appeal does NOT automatically stay a revocation order. The revocation remains in effect and the registrant must cease operating unless and until the Tribunal, on application by the registrant, specifically grants a stay of the Registrar's order. This is a critical distinction — the appellant bears the burden of seeking interim relief from the Tribunal, and the Tribunal has discretion to grant or deny it.

Question 98: A registered travel agent is winding down operations due to insolvency. At the time of closure, the trust account holds $180,000 in consumer funds for future travel. Several trade creditors are owed a combined $95,000. Under O. Reg. 26/05, what is the correct treatment of the trust account funds?

Trust funds may be distributed proportionally among all creditors, including consumers, once a licensed insolvency trustee is appointed
Trust funds revert to TICO upon insolvency, and TICO then determines the allocation between consumers and trade creditors
Trust funds must first be used to satisfy outstanding supplier invoices before any amount is returned to consumers
Trust funds are protected from the claims of general creditors and must be applied to consumers' travel services or refunded to consumers ahead of other creditors (Correct answer)

Correct answer: Trust funds are protected from the claims of general creditors and must be applied to consumers' travel services or refunded to consumers ahead of other creditors

One of the fundamental purposes of the trust account requirement under O. Reg. 26/05 is to shield consumer funds from the registrant's general creditors in the event of insolvency. Trust monies do not form part of the registrant's general estate — they must be applied toward the consumers' travel services or returned to consumers before any distribution to trade creditors. This is why proper trust account maintenance is a core compliance obligation, not merely an administrative one.

Question 99: Under TICO's financial requirements, when a new travel agent applicant cannot demonstrate sufficient financial stability through their financial statements, TICO may require a security deposit. Which factor is the PRIMARY basis for calculating the required security deposit amount for an established registrant at renewal?

The number of consumer complaints filed against the registrant in the prior registration period
The total value of customer funds held in trust on the renewal date
The registrant's personal credit score and net worth statement
The registrant's annual gross sales of travel services as reported in their financial statements (Correct answer)

Correct answer: The registrant's annual gross sales of travel services as reported in their financial statements

The security deposit calculation for established travel agent registrants is tied to their annual gross sales of travel services, as disclosed in their financial statements. This sales-based formula reflects the registrant's exposure to consumer funds — higher sales volume means greater potential consumer financial risk, which is what the security deposit is designed to backstop. Personal credit scores and complaint history are factors in broader character and financial responsibility assessments but are not the primary formula inputs for the deposit amount itself.

Question 100: What does 'trust account reconciliation' require a travel registrant to compare?

Monthly revenue against projected sales targets
Operating account balance against payroll obligations
Number of bookings against supplier invoices received
Trust account bank balance against client liability records (Correct answer)

Correct answer: Trust account bank balance against client liability records

Reconciliation means confirming that the trust account bank balance equals the total of all outstanding client liabilities held by the agency.

TICO - Travel Industry Council of Ontario Exam

The TICO exam certifies Ontario travel counsellors on the Travel Industry Act, consumer protection, trust accounting, advertising standards, and industry regulations.

100

Questions

120 min

Time Limit

70%

To Pass

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