Retail Payment Activities Act (S.C. 2021, c. 23, s. 177)

Marginal note:Contents of notice

• 77 (1) A notice of violation must name the individual or entity believed to have committed a violation, identify the violation and set out

  • (a) the penalty to be paid;

  • (b) the right of the individual or entity, within 30 days after the day on which the notice is served or within any longer period that the Bank specifies, to pay the penalty or to make representations to the Governor with respect to the violation and the penalty, and the manner for doing so; and

  • (c) the fact that, if the individual or entity does not pay the penalty or make representations in accordance with the notice, the individual or entity will be deemed to have committed the violation and is liable to pay the penalty.

• Marginal note:Short-form descriptions

  (2) The Bank may establish, in respect of each violation, a short-form description to be used in notices of violation.

• Marginal note:Administrative corrections

  (3) If a notice of violation contains any error or omission, the Bank may issue and cause to be served a corrected notice of violation on the individual or entity at any time during the period referred to in paragraph (1)(b).

Marginal note:Payment of penalty

• 78 (1) If the individual or entity pays the penalty set out in the notice of violation, the individual or entity is deemed to have committed the violation and proceedings in respect of it are ended.

• Marginal note:Representations to Governor

  (2) If the individual or entity makes representations in accordance with the notice, the Governor must decide, on a balance of probabilities, whether the individual or entity committed the violation and, if so, may, subject to any regulations made under paragraph 101(1)(k) or (l), impose the penalty set out in the notice, a lesser penalty or no penalty.

• Marginal note:Failure to pay or make representations

  (3) An individual or entity that neither pays the penalty set out in the notice nor makes representations in accordance with the notice is deemed to have committed the violation and is liable to pay the penalty set out in the notice.

• Marginal note:Notice of decision and right of appeal

  (4) The Bank must cause notice of any decision made under subsection (2) or the penalty that the individual or entity is liable to pay under subsection (3) to be issued and served on the individual or entity together with notice of the right of appeal under subsection 84(1).

Marginal note:Contents of compliance agreement

• 79 (1) If the Bank offers to enter into a compliance agreement with a payment service provider under paragraph 76(2)(b), the agreement must

  • (a) identify the provision that was contravened and provide that the payment service provider will comply with that provision within the period and be subject to the terms and conditions specified in the agreement; and

  • (b) set out the amount that the payment service provider will have to pay as the reduced penalty for the violation if the compliance agreement is entered into.

• Marginal note:Refusal to enter into agreement

  (2) If the payment service provider does not enter into the compliance agreement and does not pay the reduced penalty within 30 days after the day on which the payment service provider received the notice of violation, the payment service provider is deemed to have refused to enter into the agreement and is liable to pay the full penalty set out in the notice of violation.

• Marginal note:Extension of period

  (3) The Bank may extend the period referred to in paragraph (1)(a) if it is satisfied that the payment service provider is unable to comply with it within that period for reasons beyond their control.

Marginal note:Deemed violation

80 A payment service provider that enters into a compliance agreement referred to in a notice of violation issued under paragraph 76(2)(b) is deemed to have committed the violation in respect of which the agreement was entered into.

Marginal note:Compliance agreement complied with

81 If the Bank considers that a compliance agreement with a payment service provider has been complied with, the Bank must serve a notice to that effect on the payment service provider and, on the service of the notice, no further proceedings may be taken against the payment service provider with respect to the violation.

Marginal note:Compliance agreement not complied with

• 82 (1) If the Bank considers that a compliance agreement with a payment service provider has not been complied with, the Bank may issue and cause to be served a notice of default on the payment service provider to the effect that the payment service provider is liable to pay

  • (a) the difference between the penalty set out in the notice of violation and any portion of the reduced penalty under the compliance agreement that was paid; and

  • (b) an additional penalty specified in the regulations.

• Marginal note:Contents of notice

  (2) The notice of default must specify the date, which must be 30 days after the day on which the notice is served, on or before which an application for review may be filed and particulars of how the application may be filed.

• Marginal note:No set-off or compensation

  (3) On the service of a notice of default, the payment service provider served has no right of set-off or compensation against any amount that it spent under the compliance agreement.

Marginal note:Application for review

• 83 (1) A payment service provider served with a notice of default may, on or before the date specified in the notice or within any time that the Bank allows, file an application for review of the Bank’s decision made under that subsection with the Governor.

• Marginal note:Decision

  (2) The Governor may confirm the Bank’s decision or decide that the payment service provider has complied with the compliance agreement.

• Marginal note:Failure to pay or apply for review

  (3) A payment service provider that neither pays the amounts set out in the notice of default nor files an application for review in accordance with the notice is deemed to have not complied with the compliance agreement and must pay the amounts set out in the notice of default without delay.

• Marginal note:Notice of decision

  (4) The Bank must cause notice of the Governor’s decision to be issued and served on the payment service provider together with notice of the right of appeal under subsection 84(1).

Marginal note:Right of appeal

• 84 (1) An individual or entity on which a notice of a decision made under subsection 78(2) or 83(2) is served may, within 30 days after the day on which the notice is served or within any longer period that the Federal Court allows, appeal the decision to that Court.

• Marginal note:Appeal — no notice of decision

  (2) If the Bank does not cause notice of a decision to be issued and served under subsection 78(4) within 90 days after the day on which representations under subsection 78(2) were made, the individual or entity may appeal the penalty set out in the notice of violation to the Federal Court within 30 days after the day on which the 90-day period expires.

• Marginal note:Appeal — no notice of decision

  (3) If the Bank does not cause notice of a decision to be issued and served under subsection 83(4) within 90 days after the day on which the Governor received the application for review under subsection 83(1), the individual or entity that filed the application may appeal to the Federal Court the amounts set out in the notice of default referred to in subsection 82(1) within 30 days after the day on which the 90-day period expires.

• Marginal note:Powers of Federal Court

  (4) On an appeal, the Federal Court may confirm, set aside or, subject to any regulations made under paragraph 101(1)(k) or (l), vary the decision.

Rules About Violations

Marginal note:Violations not offences

85 For greater certainty, a violation is not an offence and, accordingly, section 126 of the Criminal Code does not apply in respect of a violation.

Marginal note:Due diligence available

• 86 (1) Due diligence is a defence in a proceeding in relation to a violation.

• Marginal note:Common law principles

  (2) Every rule and principle of the common law that renders any circumstance a justification or excuse in relation to a charge for an offence applies in respect of a violation to the extent that it is consistent with this Act.

Marginal note:Liability

87 An individual or entity is liable for a violation that is committed by any of its employees, third-party service providers, or agents or mandataries acting in the course of their employment, their contract or the scope of their authority as agent or mandatary, whether or not the employee, third-party service provider or agent or mandatary that actually committed the violation is identified.

Recovery of Debts

Marginal note:Debts due to Her Majesty

• 88 (1) The following amounts constitute a debt due to Her Majesty in right of Canada that may be recovered in the Federal Court or any other court of competent jurisdiction:

  • (a) the amount of the penalty set out in a notice of violation, beginning on the day on which it is required to be paid in accordance with the notice, unless representations are made in accordance with the notice, a compliance agreement is entered into or the decision is appealed;

  • (b) if representations are made, the amount of the penalty that is imposed by the Governor, beginning on the day specified by the Governor or, if no day is specified, beginning on the day on which the decision is made;

  • (c) every amount set out in a compliance agreement, beginning on the day on which the compliance agreement is entered into or the day specified in the compliance agreement;

  • (d) the amount of a penalty set out in a notice of default referred to in subsection 82(1), beginning on the day on which the period specified in the notice expires, unless a review is requested under subsection 83(1);

  • (e) if a review is requested under subsection 83(1) and the Governor confirms the Bank’s decision, the amount of the penalty set out in the notice of default referred to in subsection 82(1), beginning on the day specified by the Governor or, if no day is specified, beginning on the day on which the Governor’s decision is made, unless the decision is appealed;

  • (f) the amount of a penalty determined by the Federal Court under subsection 84(4), beginning on the day on which the period specified in the decision for the payment of that amount expires or the day specified in the decision; and

  • (g) the amount of any costs and expenses referred to in subsection (3).

• Marginal note:Limitation or prescription period

  (2) Proceedings to recover a debt referred to in subsection (1) may be commenced no later than the fifth anniversary of the day on which the debt becomes payable.

• Marginal note:Liability

  (3) An individual or entity that is liable to pay the amount of any debt referred to in any of paragraphs (1)(a) to (f) is also liable for the amount of any costs and expenses incurred in attempting to recover that amount.

• Marginal note:Proceeds payable to Receiver General

  (4) A debt referred to in subsection (1) that is paid or recovered is payable to and must be remitted to the Receiver General.

Marginal note:Certificate

• 89 (1) The unpaid amount of any debt referred to in subsection 88(1) may be certified by the Governor.

• Marginal note:Registration in Federal Court

  (2) Registration in the Federal Court of a certificate has the same effect as a judgment of that Court for a debt of the amount specified in the certificate and all related registration costs.

General

Marginal note:Limitation or prescription period

90 No notice of violation is to be issued after the second anniversary of the day on which the Bank becomes aware of the acts or omissions that constitute the alleged violation.

Marginal note:Certification by Bank

91 A document purporting to have been issued by the Bank, certifying the day on which the acts or omissions that constitute the alleged violation became known to the Bank, is admissible in evidence without proof of the signature or official character of the person appearing to have signed the document and, in the absence of evidence to the contrary, is proof that the Bank became aware of the acts or omissions on that day.

Marginal note:Evidence

92 In a proceeding in respect of a violation, a notice of violation purporting to be issued under subsection 76(2), a notice of decision purporting to be issued under subsection 78(4) or 83(4), a notice of default purporting to be issued under subsection 82(1) or a certificate purporting to be made under subsection 89(1) is admissible in evidence without proof of the signature or official character of the person appearing to have signed it.

Marginal note:Publication

• 93 (1) As soon as feasible after a payment service provider is deemed under subsection 78(1) or (3) to have committed a violation or after a notice of decision stating that the payment service provider has committed a violation is served under subsection 78(4), the Bank must make public the nature of the violation, the name of the payment service provider and the amount of any penalty imposed.

• Marginal note:Reasons

  (2) In making public the nature of a violation, the Bank may include the reasons for its decision to issue the notice of violation and any related decision, including the relevant facts, analysis and considerations that formed part of the decision.

Compliance Orders

Marginal note:Governor’s orders

• 94 (1) If the Governor is of the opinion that a payment service provider that performs retail payment activities is committing, or is about to commit, an act that could have a significant adverse impact on an individual or entity referred to in subsection (2), the Governor may, by order, direct the payment service provider to

  • (a) cease or refrain from committing the act or pursuing the course of conduct; and

  • (b) perform any acts that, in the Governor’s opinion, are necessary to remedy the situation.

• Marginal note:Individuals and entities

  (2) The individuals and entities are any of the following:

  • (a) an end user;

  • (b) a payment service provider that performs retail payment activities, whether or not this Act applies to them; and

  • (c) a clearing house of a clearing and settlement system, as those expressions are defined in section 2 of the Payment Clearing and Settlement Act, that is designated under subsection 4(1) of that Act.

• Marginal note:Opportunity for representations

  (3) Subject to subsection (4), no order is to be made in respect of a payment service provider under subsection (1) unless the payment service provider is provided with a opportunity to make representations in respect of the matter.

• Marginal note:Temporary order

  (4) If, in the Governor’s opinion, the length of time required for representations to be made might be prejudicial to the public interest, the Governor may make a temporary order that has the same effect as an order under subsection (1). The order ceases to have effect 30 days after the day on which it is made or after the expiration of a shorter period that is specified in the order.

• Marginal note:Continued effect

  (5) A temporary order continues to have effect after the expiration of the 30-day or the shorter period if no representations are made to the Governor within that period or, if representations are made, the Governor notifies the payment service provider that the Governor is not satisfied that there are sufficient grounds for revoking the order.

Marginal note:Court enforcement

• 95 (1) If an individual or entity is contravening or has contravened a provision of this Act, the regulations or an order made under subsection 94(1) or (4), the Governor may, in addition to any other action that may be taken under this Act, apply to a superior court for an order requiring the individual or entity to cease the contravention or to comply with the provision.

• Marginal note:Powers of court

  (2) The court may make the order and may make any other order the court thinks fit.

• Marginal note:Appeal

  (3) An appeal from an order made under subsection (2) lies in the same manner and to the same court as an appeal from any other order of the court.