Could Premier Doug Ford’s proposed law forbidding ticket resales above face-value finally spell an end to scalpers?
Seven years after Ford removed a cap on resale prices, which his government called “unenforceable,” the premier now wants to make it illegal to resell tickets above face value in Ontario.
Ticket giant Live Nation Entertainment, which merged with Ticketmaster in 2010, said it supports the cap, while aftermarket company SeatGeek said the law would “only make things worse,” for the fans it’s designed to protect.
Others are concerned the original prices on tickets could rise as companies such as Ticketmaster see their profits drop on resales.
Vass Bednar, managing director of the policy think tank Canadian Shield Institute, said that could indeed happen, but notes prices are going up anyway, as “they’ve been raising those initial prices for quite some time.”
Many industry observers predicted an emerging black market.
Price caps, “have been tried, and they don’t work,” said Pascal Courty, an economics professor at the University of Victoria.
They may give the “illusion” of fair pricing, he added, but the actual costs would become “opaque” as buyers and sellers continue making deals on the side.
For example, he added, someone could list a ticket for sale on StubHub, but exchange emails with the buyer and only release the tickets after receiving extra cash privately.
“It’s impossible to implement because you’re trying to prevent voluntary trade between two people,” Courty said, adding that consumers want to attend events, and the real problem is scarcity.
“There is a solution,” which has been implemented in China, he said, and is gaining popularity in the industry.
‘Nominative tickets’ — non-transferable tickets tied to the buyer’s identity that are returned to the platform if someone cancels — are the “gold standard” to ensure entries to large events go to fans, and not resellers, he said.
“Identity verification for admission in the venue,” Courty said, “is what prevents resale for profit by brokers.”
Bednar is approaching the proposed law with cautious optimism.
“We’re in this sovereignty moment, and that also means that everyday Canadians are pushing back against extractive corporate power that feels like it’s getting out of control,” she said.
Ticket resale has been “supercharged” in the digital era through online platforms that allow companies to “capture more value for each ticket,” she added.
Whether ticket reselling moves to a black market will depend on how the policy is implemented, she said, and the change could still curb price hikes overall.
“This is a provincial government, a subnational government, trying to hold major digital firms accountable,” Bednar said. “Most of the time, these are foreign firms. That’s hard to do. But if we can’t govern the markets we have, we’re not a sovereign state.”
In November, the U.K. government proposed making it illegal to resell live event tickets above the original cost, but the change hasn’t been implemented.
Adam Webb, campaign manager for U.K.-based campaign against “industrial-scale” online ticket scalping, FanFair Alliance, called the exploitation of fans a “global challenge,” and welcomed the news of a proposed change in Ontario.
“The only way to address the issue is by introducing well-crafted, enforceable legislation that caps ticket resale prices,” Webb wrote in a statement.
“That kind of intervention is fundamental to replacing a broken and corrupt system with a properly-functioning market,” he said, “where consumers can resell unwanted tickets to other consumers for no more than the price originally paid.”
Live Nation says it supports resale price capping
Ticketing platforms, too, had varying reactions.
Live Nation spoke favourably of the development.
“Live Nation Entertainment supports the Ontario government’s commitment to protecting fans by capping the resale price of concert tickets,” a Live Nation Entertainment spokesperson said in a statement. “We are in favour of measures that promote fair, transparent ticketing and curb exploitative resale practices. We welcome ongoing conversations with the government to continue safeguarding artists and fans while keeping live events accessible.”
SeatGeek, meanwhile, said the proposal risks increasing fraud in unregulated channels and propping up the biggest companies.
“Price controls on ticket resale, while well-intentioned, only make things worse for the very fans they’re designed to protect,” SeatGeek V-P Joe Freeman said in a statement. “Controls won’t eliminate consumer demand — they shift costs in ways that are harder to see, whether through higher base prices or fees buried elsewhere in the transaction.”
