Canada to Raise Airline Penalties and Speed Up Passenger Compensation Process

The federal government has unveiled a series of measures aimed at strengthening passenger rights and holding airlines more accountable for service disruptions. Transport Minister Steven MacKinnon announced that the maximum fine for airlines repeatedly violating Canada’s air passenger protection rules will rise sharply from $250,000 to $1 million.

Speaking at a press conference in Ottawa, MacKinnon emphasized that stricter enforcement will be paired with faster compensation for travelers. Under proposed legislation, airlines will be required to compensate eligible passengers within 30 days for delays or cancellations that fall within their control. “No excuses,” he stated firmly.

Canada’s Air Passenger Protection Regulations, introduced in 2019, were designed to ensure travelers receive compensation for disruptions caused by airlines. However, enforcement challenges have persisted. The Canadian Transportation Agency (CTA), which handles disputes between passengers and airlines, is currently facing a significant backlog approximately 100,000 unresolved complaints.

To tackle this issue, the government plans to bring in an independent third-party dispute resolution body. This move is intended to accelerate the processing of claims and introduce more efficient, private-sector practices into the system.

MacKinnon also highlighted upcoming regulatory changes aimed at simplifying the rules and making them more transparent. The goal is to ensure passengers receive fair compensation more quickly. Additionally, the government intends to remove restrictions that currently limit travelers from openly discussing the outcomes of their complaints.

“Decisions by the Canadian Transportation Agency can take years, and that is simply unacceptable,” MacKinnon said. “Canadians deserve a system that works better and delivers results faster.”

The announcement comes alongside broader discussions about the future of Canada’s aviation sector. Earlier this week, the government confirmed it is exploring the possibility of inviting private investment into the country’s airports. Consultations with airport authorities are still in early stages, with officials evaluating potential models to improve efficiency and passenger experience.

While no final decisions have been made regarding airport privatization, MacKinnon noted that the overarching objective remains clear: modernizing Canada’s air travel system to better serve passengers.

The proposed changes signal a significant shift in how the government plans to regulate airlines, aiming to reduce delays in compensation and restore public confidence in air travel.