The Ontario Ministry of Consumer Services (Ministry) has proposed new administrative monetary penalties (AMPs) in connection with 16 of the statutes that it oversees. These statutes include the Collection Agencies Act, Consumer Protection Act, Consumer Reporting Act, Motor Vehicle Dealers Act, Payday Loans Act and Real Estate and Business Brokers Act.
Currently, the Ministry is seeking stakeholder input on a consultation paper (Paper) that outlines the purpose and scope of the proposed AMPs.
Highlights of the Paper are:
- Responsibility for the AMP Framework: Each statute is overseen by either the Ministry directly or by a regulatory administrative authority under the Ministry's supervision. The Paper contemplates that each regulator would be responsible for developing its own AMP policy prior to being granted the legal authority to issue AMPs. Although each AMP policy would need to meet established legislative criteria, and the regulators would be encouraged to develop consistent approaches, it is likely that there will be variation from policy to policy. The policies will have the force of law once finalized and recognized by the government.
- Penalty Levels: The Paper proposes three penalty levels: Level 1 for minor violations, Level 2 for more serious violations and Level 3 for the most serious violations. The penalty amount ranges from C$100 to C$10,000 per infraction. The regulators would be given specific criteria, established in the legislation, to consider when assessing the penalty level for a particular violation. These criteria include the nature and severity of the violation, any prior history of non-compliance, whether the regulated party was actively working to achieve compliance, whether the violation was intentional and whether there was an economic gain to the regulated party from its non-compliant behavior.
- Review Process: A right of appeal for an administrative matter, such as an AMP, can only be provided by statute. While the Paper states that a review process would be established in the applicable legislation, it appears that the process would be internal within the regulatory body. There is no mention of a specific right to appeal to a court or other external body. It is also unclear whether the review process would include a requirement that the regulator must provide notice prior to imposing an AMP or the reasons for its decision, or whether a regulated party would have an opportunity to respond to the regulator's decision before an AMP was imposed.
- Name and Shame: The Paper, consistent with typical regulatory practice, proposes that regulators will have the power to publicize information about a regulated entity's compliance record. Regulators would be required to publicize information about Level 2 and 3 violations. Publication of a Level 1 violation would be at the regulator's discretion. The Paper does not contemplate that any review process must be completed prior to publication.
This development highlights not just the increased focus on consumer protection issues that has certainly been a trend in 2013, but also the continued popularity of AMPs among regulatory authorities at all levels of government.
The Ministry is seeking comments on the Paper until December 12, 2013.