CSTAR - Reasons and Order dismissing the application for interim relief

CSTAR - Reasons and Order dismissing the application for interim relief Collection Case Documents Date Filed 2008-06-03 Neutral citation 2008 Comp Trib 12 File Number CT-2008-006 Document Type Decisions Type of Application Leave to Make Application Section(s) of the Competition Act Section 103.1 - Leave to make an application under section 74.1, 75, 76, 77, 79 or 90.1 Proceeding Number 36 Decision Content Competition Tribunal Tribunal de la Concurrence Reference: Canadian Standard Travel Agent Registry v. International Air Transport Association., 2008 Comp. Trib. 12 File No.: CT-2008-006 Registry Document No.: 0036 IN THE MATTER of the Competition Act, R.S.C. 1985, c. C-34, as amended; AND IN THE MATTER of an Application by Canadian Standard Travel Agent Registry doing business as CSTAR for an Order pursuant to section 103.1 granting leave to make application under section 75 of the Competition Act; AND IN THE MATTER of an Application by Canadian Standard Travel Agent Registry doing business as CSTAR for an Interim Order pursuant to section 104 of the Competition Act. B E T W E E N: Canadian Standard Travel Agent Registry doing business as CSTAR (applicant) and International Air Transport Association doing business as IATA (respondent) Date of hearing: 20080530 Presiding Judicial Member: Simpson J. (Chairperson) Date of Order: May 30, 2008 Order signed by: Sandra J. Simpson REASONS AND ORDER DISMISSING THE APPLICATION FOR INTERIM RELIEF [1] FURTHER TO a notice of application filed by Canadian Standard Travel Agent Registry doing business as CSTAR (the “Applicant”) on May 20, 2008, for an order pursuant to section 103.1 of the Competition Act, R.S.C. 1985, c. C-34, as amended (the “Act”), granting leave to make an application under section 75 of the Act; [2] AND FURTHER TO the Applicant’s notice of application pursuant to section 104 of the Act for an interim order requiring the Respondent to continue to provide and allow for the use of neutral paper airline tickets pending the hearing of the main application; [3] AND UPON reviewing the material filed by the Applicant and the Respondent; [4] AND UPON hearing representations from counsel for both parties by teleconference on May 30, 2008; [5] AND UPON delivering an oral decision at that time dismissing the application for an interim order with brief reasons; [6] AND UPON indicating at the end of the teleconference that a formal order and reasons would follow; THE TRIBUNAL ORDERS THAT: [7] The application for an interim order is hereby dismissed. REASONS: [8] The Canadian Standard Travel Agent Registry doing business as CSTAR (the “Applicant”) applied to the Tribunal for an interim order pursuant to section 104 of the Competition Act, R.S.C. 1985, c. C-34 (the “Act”). The Applicant has also applied to the Tribunal for leave to bring an application under s. 75 of the Act. The issue of leave has not yet been decided because the Respondent’s written representations are not due until June 11, 2008 and thereafter the Applicant has a right of reply. [9] The Applicant sought an order requiring the International Air Transport Association doing business as IATA (the “Respondent”) to continue to allow IATA accredited travel agencies in Canada to use neutral paper airline tickets (“Paper Tickets”) after June 1, 2008. The Respondent was about to implement an international initiative moving towards exclusive E-ticketing by eliminating Paper Tickets used by its accredited travel agencies throughout Canada and elsewhere (other than the United States) on June 1, 2008. JURISDICTION [10] Section 104 of the Act provides that a person who has made an application under section 75 may apply to the Tribunal for an interim order. [11] In my view section 104 of the Act provides that no application is made under section 75 until leave is granted. This interpretation means that in this case section 104 does not apply. [12] However the Competition Tribunal has jurisdiction over the management of its cases and its proceedings including pending proceedings. The Applicant’s request for interim relief is therefore properly characterized as a motion in a pending proceeding. The Competition Tribunal Rules, SOR/2008-141 do not cover this situation. [13] Rule 34 of the Competition Tribunal Rules, which is the gap rule, therefore applies, allowing the Tribunal to rely on Rule 372 of the Federal Courts Rules, SOR/2004-283. Rule 372 of the Federal Courts Rules provides that in the case of urgency, prior to the commencement of a proceeding, a party may apply for interim relief. THE TEST FOR INTERIM RELIEF [14] The applicable authority is the Supreme Court of Canada’s decision in RJR MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311. According to RJR MacDonald, to issue an order for injunctive relief a court must be satisfied that there is a serious issue to be tried and that not granting interim relief will cause irreparable harm to the applicant and that the balance of convenience favours the applicant. The decision in this case turns on the balance of convenience. BALANCE OF CONVENIENCE [15] After reviewing both parties’ evidence regarding whether or not the order sought would be effective or enforceable, I am of the opinion that the evidence provided by the Respondent is more reliable on the current status of the implementation of E-ticketing and, on the feasibility of complying with an order requiring the Respondent to continue to allow IATA accredited travel agencies in Canada to use Paper Tickets after June 1, 2008. [16] Based on that evidence I have concluded that an interim order made now would not be effective because: (A) Although airlines will retain the ability to issue paper tickets on their own paper stock after June 1, 2008, certain airlines will no longer accept Paper Tickets. The Respondent has no power to force airlines to accept Paper Tickets after June 1, 2008. (B) Airline staff and handling agents in all the airports of the world have been briefed and trained not to accept any Paper Tickets issued after May 31, 2008. Therefore, passengers who might receive Canadian Paper Tickets after June 1, 2008 under the Tribunal’s order, would be at risk of not being able to board a plane. (C) The Respondent terminated its agreement with all of its Paper Ticket printers several months ago and the supply of Paper Tickets is low. The Respondent could therefore not ensure that it would be physically able to continue to supply IATA accredited travel agencies with Paper Tickets. (D) The Data Processing Centre for billing and settlements in Canada is part of an operation covering 40 countries around the world using a common software program. It would now not be possible to make an exception for Canada to allow it to continue to use Paper Tickets after June 1, 2008. CONCLUSION [17] For these reasons an order from the Tribunal requiring the continued use of Paper Tickets in Canada would likely be ineffective and unenforceable. DATED at Ottawa, this 30 th day of May 2008. SIGNED on behalf of the Tribunal by the presiding judicial member. (s) Sandra J. Simpson COUNSEL: For the applicant Canadian Standard Travel Agent Registry doing business as CSTAR Tim Gilbert Nawel Bailey For the respondent International Air Transport Association doing business as IATA D. Martin Low Q.C. Eric Vallières