In the aftermath of the controversy over the price of tickets sold by online ticket resellers for the Tragically Hip’s summer tour, a private member’s bill, Bill 22, Ticket Speculation Amendment Act (Purchase and Sale Requirements), 2016 (“Bill 22”) passed 2nd reading in the Ontario Legislature on September 29, 2016. Bill 22 targets ticket bots, computer software used to purchase large volumes of tickets by bypassing security features that limit the number of tickets that can be purchased in a single transaction. These tickets are then resold to consumers, often at a higher price.
Our neighbour to the south is also targeting ticket bots. In early September, the U.S. House of Representatives passed the Better Online Ticket Sales Act of 2016 (or BOTS Act). In order to become law, the Act has to be passed by the U.S. Senate and receive presidential approval. Similar to Bill 22, the BOTS Act makes it illegal to sell tickets purchased by the use of bots.
Brief overview of the Act
Concerns surrounding the online sale of fraudulent tickets for sporting and entertainment events formed provisions of the Ticket Speculation Act (Ontario) (the “Act”). Under the Act, reselling a ticket above face value is prohibited (with certain exemptions) and, if found guilty, a person is liable to a fine of up to $5,000. The Act provides the following exemptions to:
- Allow official ticket sellers to authenticate resold tickets
- Allow tickets to be resold above face value where the tickets are authenticated or have a money-back guarantee
- Allow tickets to be resold at a price that includes any service fees paid when the ticket was initially purchased
Bill 22 amendments
Bill 22 proposes to amend the Act by:
- Making it illegal to buy a ticket using software that bypasses the security features used to limit the number of ticket sales purchased at one time. If convicted for contravention, an individual is liable to a fine of up to $50,000 or jail for up to 1 year, or both, and a corporation is liable for a fine of up to $250,000.
- Requiring a secondary ticket seller to list the original purchase price for a ticket when offering a ticket for sale. If convicted for contravention, a person is liable for a fine of up to $10,000 for the first offence and up to $25,000 for a second or subsequent offence.
Private member bills do not often become law, but there appears to be support for the bill in the Ontario Legislature and from some stakeholders. As is the case with most consumer protection legislation, it is a matter of balancing consumer protections with having a competitive marketplace. Targeting computer software adds complications, raising questions as to the enforceability of the proposed amendments (as to the use of ticket bots). Additionally, recognizing that the proposed intention of Bill 22 is to target “unscrupulous” ticket resellers, the amendments must be structured in a manner that does not impact bona fide ticket sellers.