Ontario passes law to ban scalper bots, cap resale prices, fortify ticket rules

Scalper bots are now banned in Ontario, as a bill to protect ticket buyers passed Wednesday, though the ticket industry warns some parts of the legislation may put fans at a disadvantage.

The provisions in the new Ticket Sales Act are contained in omnibus consumer protection legislation that also strengthens rules around home warranties, real estate practices and travel services in Ontario.

Changes to ticket-selling laws include banning so-called scalper bots, which buy a large number of tickets online for an event and then resell them at a large profit.

The ticket sales and events industry largely welcomed the ban, with Ticketmaster, a major ticket seller, saying it is in an “arms race” to develop new tools to combat the bots. In North America, the company blocked five billion bots last year, an executive told the legislative committee considering the bill last month.

“There are only two types of buyers: There are fans and there are cheaters,” Patti-Anne Tarlton from Ticketmaster Canada told the committee. “It’s no secret that there’s a vast network of cheaters, both domestic and globally, who are seeking to manipulate and game our system. The goal is for them to beat fans at on-sale and to cheat fans at resale.”

Ontario Attorney General Yasir Naqvi has acknowledged enforcement may be difficult when it comes to bots that often operate from outside Canada, so he said the law aims to undercut both profit incentive and resale abilities.

“One of the most effective ways we’re doing it is by taking away the financial incentive, by putting a 50 per cent cap on resale prices in the resale market,” he said.

The law bans tickets from being resold at more than 50 per cent above the face value and makes it illegal to knowingly resell tickets that were purchased by bots.

Ticket sellers will also have to display an itemized list of all fees, taxes and service charges, and resellers would have to disclose the face value of the ticket.

Ticket resale site StubHub welcomed the scalper bot ban, but it warned that artificially controlling a global market “will lead to unintended consequences.”

“Resales will be driven off of secure channels into places where consumers are exposed to counterfeit and fraud, with zero protections,” StubHub’s Jeff Poirier told the committee.

StubHub said bots are not the only reason fans have trouble accessing tickets, saying primary ticket sellers often hold back large percentages of tickets during general sales.