Ottawa plans to outsource air passenger complaints process amid record backlog

Travellers wait at the Air Canada counter in Montreal-Pierre Elliott Trudeau International Airport in Dorval, Que., Friday, Aug. 15, 2025.

MONTREAL — The federal government aims to outsource the air passenger complaints process to a third party in a bid to clear the massive backlog at the country’s transport regulator.

In Ottawa’s spring economic update this week, the Liberals said they plan to import a model used in the United Kingdom and Europe that sees independent adjudicators resolve complaints over issues ranging from refunds to accessibility.

The change would mark an end to the current in-house process under the Canadian Transportation Agency, where the backlog sits at a record 97,000 complaints.

The upcoming legislation also aims to simplify the passenger rights charter “so that rules are clearer and passengers are fairly and more quickly compensated,” the government said. Together, the changes would “enhance transparency of the complaints process and enforcement of passenger rights regulations.”

The move comes three years after Ottawa announced reforms to the regulatory regime that have yet to take effect.

Earlier this month, Air Canada launched an alternative process to resolve compensation claims in a pilot project that taps an external arbitrator. Funded by the airline, the parallel arbitration track will be run by a subsidiary of U.K.-based CDRL Group, a non-profit that resolves dispute claims in areas ranging from retail to utilities.

Met with skepticism by consumer rights advocates, the moves by both the airline and the government hint at mounting frustration with the existing framework, where cases can take years to conclude despite a staffing boost -- more than 100 “complaint resolution officers” -- over the past few years.

Gabor Lukacs, president of the Air Passenger Rights advocacy group, said this week’s decision to transfer handling of complaints to a third party seems to be “putting the cart before the horse.”

He called on the government first to harmonize its Air Passenger Protection Regulations with the European Union’s “gold standard” regime.

He also expressed doubt about the neutrality of arbitrators across the pond.

“I question the impartiality of any third-party adjudication that is funded by the airlines,” he said in an email.

Nonetheless, the U.K.-based subsidiary of the group used by Air Canada has an average rating of 4.1 on the review platform Trustpilot, based on more than 1,220 reviews, the carrier has pointed out.

Ian Jack, vice-president at the Canadian Automobile Association, called for the same access to key flight metrics that American air travellers enjoy south of the border.

“CAA has long called for a simpler, more effective system for consumers. But whether a third-party contractor will deliver fair results can only be judged if Canadians get access to the numbers,” he said in an email.

“Will it find in favour of consumers at the same rate? How quickly will it process complaints? Will it be truly independent of the airlines?”

Some advocates have said a better solution lies in reforming the current system to close loopholes for airlines and simplify the process for travellers -- both stated goals of the changes pledged this week.

In June 2023, the federal government passed legislation that aimed to make good on the Liberals’ vow to tighten passenger rights rules after a year marked by travel chaos and a ballooning complaints backlog.

The overhauled regime included provisions that would see customers compensated under a wider range of flight disruption scenarios and make airlines pay a per-complaint fee -- regardless of the outcome -- to discourage violations.

However, progress on the reforms has stalled, with no regulatory changes finalized.

This report by The Canadian Press was first published April 29, 2026.

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