Why passengers are unlikely to win damages due to unruly fliers

Airline passengers who have their travel plans interrupted when unruly passengers force a plane to turn around or be diverted are likely to have a difficult time collecting damages for the disruption.

Those aboard Wednesday's Cuba-bound Sunwing flight that was forced to turn back to Toronto because of the alleged misbehaviour of two female passengers, reportedly received a $75 voucher from Sunwing for future trips and a $15 meal voucher at Pearson. 

The flight took off for a second time from Toronto around 11 p.m. Wednesday with a new flight crew.

But those who feel they deserve more compensation for having their vacation plans derailed, even temporarily, are probably out of luck.

Lilia Ratmanski, 25, of Whitby, Ont., left, and Melana Muzikante, 26, of Vaughan, Ont., appeared in court Thursday. They are charged with smoking on board an aircraft, endangering the safety of an aircraft, mischief endangering life, mischief over $5,000 and uttering threats. (Alex Tavshunsky/CBC)

Under Flights Rights Canada,  a six-point code of conduct that was created for Canada's airlines and voluntarily adopted by the major Canadian air carriers, nothing  "would make the airline responsible for acts of nature or the acts of third parties, according to the government website.

"Airlines are legally obligated to maintain the highest standards of aviation safety and cannot be encouraged to fly when it is not safe to do so."

In the case of this week's Sunwing flight, the pilot of the 737 aircraft described the two female passengers as disruptive "in a serious manner," and reported to NORAD (North American Aerospace Defence Command) while the plane was in U.S. airspace that the aircraft was "under threat."

NORAD scrambled two CF-18 fighter jets based out of Bagotville, Que., to escort Flight 656 back to Toronto. The women are facing a series of charges, including endangering the safety of an aircraft, smoking on an aircraft and uttering threats.

A passenger could try to seek further compensation from the airline, claiming that they believed the pilot overreacted. But John McKenna, president and CEO of the Air Transport Association of Canada, said "they wouldn't get very far."

"The pilot is captain on board," said McKenna. "He does what he deems necessary. No pilot likes to turn a plane around. It's his prerogative or her prerogative to do so if he or she thinks the safety of the passengers is at risk."

"But some people will try anything to get compensation."

Passengers could always try to launch civil legal action against those responsible for diverting the flight, but if the delay resulted in missing a day or a couple days of vacation, the time and effort in court would likely surpass any compensation they may receive.

However, trying to recoup expenses caused by the diversion may be worth it for the airline. Meaning, in this case, Sunwing could take action against the two accused. 

Indeed, the airline is currently seeking legal action against two members of a Cape Breton family accused of smoking on a flight to the Dominican Republic last year. Sunwing is suing the two, claiming their actions forced the plane to be diverted to Bermuda. The airline is suing for the damages and expenses incurred for having to divert, which include airport fees and landing fees.

In the current Sunwing case, the airline could sue or seek restitution as did Air Canada in a case against a Calgary man last year. The man's unruly behaviour forced a London-to-Calgary flight to land in Edmonton. He was given a one-year probation term, was fined $4,000 and was ordered to pay $15,200 in restitution to Air Canada.

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Canada plans legislation to end pay-to-pay billing fees

The federal government plans to introduce legislation that would halt the practice of charging fees for paper bills, an issue highlighted by the CRTC's criticism of Canadian telecom companies' pay-to-pay practices.

Industry Minister James Moore says the federal government is planning legislation that would end pay-to-pay billing fees - which are charged to customers who receive bills in the mail. (Sean Kilpatrick/Canadian Press)

Industry Minister James Moore said Friday that the government legislation will put an end to what he calls the unfair pay-to-pay fees.

Moore said Canadians expect lower prices and better service from telecom service providers. The government has twice promised to end pay-to-pay policies: In its October 2013 throne speech and in the 2014 budget.

Moore's announcement came a day after after executives from nearly a dozen major telecom companies — including Bell, Rogers and Telus — met with the Canadian Radio-television and Telecommunications Commission in Gatineau, Que.

The companies vowed to exempt some customers from pay-to-pay fees: 

• Seniors.
• Individuals with disabilities.
• Military veterans.
• Customers with no internet connections.

In a statement released after the meeting, regulators said the exemptions don't go far enough.

CRTC chair Jean-Pierre Blais said "many Canadians who will not benefit from the exemptions will be disappointed with the outcome so far."

Blais also praised the four companies — Cogeco Cable, MTS Allstream, SaskTel and Shaw Communications — that have opted not to charge for paper fees, saying "Canadians should keep this in mind when they select service providers."

According to a study released this week by the Public Interest Advocacy Centre, Canadians pay over $500 million a year in paper billing fees.

The advocacy group says low-income Canadians and seniors shoulder the heaviest burden, as they are less likely to have access to the internet. An estimated 15 per cent of Canadians do not have internet access at home. 

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Tesla Motors inks deal to build 400 charging stations in China

Tesla Motors Co. and a state-owned Chinese phone carrier announced plans Friday to build 400 charging stations for electric cars in a new bid to promote popular adoption of the technology in China.

Plans call for China Unicom Ltd. to provide space for construction and basic services in 120 cities while Tesla, based in Palo Alto, California, operates the stations. The two companies also will build 20 "supercharger stations" in 20 cities to offer high-speed charging.

Promoters of electric cars see China as a promising market due to Beijing's support for the technology and eagerness to reduce smog. But the lack of charging infrastructure in this vast country is seen as a major hurdle to winning general acceptance.

Tesla delivered its first U.S.-manufactured electric sedans to Chinese customers in April and CEO Elon Musk said then the company planned to invest several hundred million dollars to build a charging network in China.

Prior to Friday's announcement, Tesla had 200 charging points in China.

"This cooperation will accelerate the Tesla charging network nationwide," said a company spokeswoman, Peggy Yang, in an email.

Another automaker, Germany's BMW AG, announced plans in May to set up 50 charging stations in partnership with State Grid, China's biggest state-owned utility, and a real estate developer.

Chinese leaders want to develop an electric car industry and called in 2009 for annual sales of 500,000 electric cars by 2015 but have scaled back those plans. The country has about 78,000 electric vehicles on the road, mostly public buses and taxies.

Industry growth has been slow partly due to rules that limit market access unless foreign manufacturers share technology with Chinese partners that might become rivals.

In July, the government announced buyers of electric cars will be exempt from a 10 percent sales tax on automobiles.

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Tim Hortons hitched, Shomi born, Twitch adopted and NHL expecting: BUSINESS WEEK WRAP

The biggest news of the week came right at the beginning, with reports that Burger King and Tim Hortons were working out a deal. A day later, they made it official.

The two chains will unite under a new holding company based in Canada. Both of the brands will continue to operate the same way, so you won't have to order your double double with a Whopper.

Tim Hortons' interest in the deal? A chance to significantly expand south of the border, an elusive goal that they haven't been able to achieve after years of trying. A goal that won't come at the expense of the company's Canadian presence.

"We're going to keep all of the fantastic things we've done in Canada, we're going to build on that. But this brand deserves to go around the world", said Tim Hortons CEO Marc Caira in an interview on The Exchange with Amanda Lang.

For the Timmies faithful who are worried the chain will change under new ownership, Tim's took out a two-page ad in major Canadian newspapers assuring them their double-doubles will stay the same.

Competing with Netflix

Rogers and Shaw are teaming up to launch a Netflix-like streaming site in Canada. It's called Shomi, and the two telecom giants are bringing it to Canadians in November.

The service will offer 340 TV series and 1,200 movies, with 30 per cent Canadian content, and cost $8.99 per month, similar to the cost of a Netflix subscription.

At launch, the service will only be available to Shaw and Rogers TV and internet subscribers for what's being called a 'beta period' of six months to one year, at which point non-subscribers will be able to get their hands on it.

They'll have their work cut out for them in competing with Netflix, as one-third of English-speaking Canadians already subscribe to the U.S. company's service.

Betting on video game streaming

It's not just Rogers and Shaw looking to capitalize on people's desire for streaming content. Amazon is spending $970 million to buy Twitch, a site where users watch live streaming video of other people playing video games.

Why would the online retailer bet nearly $1 billion that users want to watch people play games, rather than be playing themselves? Because it works.

The site accounts for more than 43 per cent of all U.S. live streaming traffic, according to analysis by online video analytics site Qwilt. On an average night, Twitch has a viewing audience roughly the same size as popular U.S. cable channels like Comedy Central and MTV.

Games are also growing quickly as a spectator sport, with international competitions attracting millions of viewers — all through Twitch.

NHL expansion rumours

From digital sports to a more traditional kind, hockey fans in Las Vegas, Seattle, Quebec and Toronto were given reason to get their hopes up as reports circulate that new NHL teams might be coming to town as part of a big expansion push.

It's been 14 years since the league added teams in Minnesota and Columbus, and the addition of four new teams could put as much as $1.4 billion dollars into the owners' pockets through expansion fees.

The NHL is staying quiet, and likely wouldn't say anything until a final announcement is made. But Glen Hodgson, Chief Economist of the Conference Board of Canada and author of Power Play: The Business Economics of Pro Sports says there are several markets that could handle an expansion team, including Toronto.

In an interview with The Exchange, Hodgson said "there's no doubt that Toronto is a big enough market right now to have two even three NHL teams. and the market's going to grow over the next 20 years".

Those were some of the most-read stories on our website this week. Be sure and check back often for more news, and remember to follow us on Twitter here.

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Health Canada pulling last of citronella-based bug sprays

Health Canada is pulling the last of citronella-based bug sprays off the shelves by the end of December because of "the absence of adequate safety data." The essential oil has been used as an insect repellent in Canada for decades.

The move has left scientists who advised Health Canada on the issue befuddled by the ban. So are many consumers who prefer natural bug sprays over ones with synthetic chemicals like DEET.

'It's the basis of the ban that I don't really understand'- Sam Kacew, Toxicologist

"It's the basis of the ban that I don't really understand," says toxicologist Sam Kacew.

Insect repellents are considered pesticides so they must meet strict safety standards. In 2004, Health Canada proposed phasing out citronella-based bug sprays because of new questions about its safety.

Small manufacturers who couldn't afford to submit detailed safety data saw their lines discontinued at the end of 2012. Those who submitted what data they could and tried to challenge the ban are now to see their products phased out at the end of this year.

In 2005, Kacew sat on an independent scientific panel to review Health Canada's position. He says the panel believed the study that led the government to question citronella's safety was flawed, in part because it examined what happened when rodents ingested the oil. "Humans are not going to drink citronella," he says.

The department told CBC that "the panel supported Health Canada's approach," but Kacew refutes that. He says the team of scientists concluded that citronella was safe as long as it didn't contain methyl eugenol, an impurity that could be a potential carcinogen. "In general, most of these citronella oils that were available for us to examine did not contain impurities, and they were regarded by us to be basically safe," he says.

Companies pay the price

Montreal company, Druide, has been selling government-approved citronella sprays and lotions since 1995.

"Where I am very sad is, in the end, [Health Canada] doesn't have anything against citronella, except questions about it," says Druide's owner, Alain Renaud.

Health Canada is ordering all citronella-based bug sprays off the shelves by the end of December because of "the absence of adequate safety data." (CBC)

​

He says he spent five years proving to Health Canada that his repellent didn't contain methyl eugenol.

But Renaud says that as soon as he won that battle the government "came back and said we still have questions and we need a complete toxicological report on many generations of animals."

That may be a standard approach, but Renaud eventually gave up his fight because his company doesn't believe in animal testing, and didn't have the estimated $1 million needed to fund a large-scale scientific study.

Druide's citronella-based bug spray was a bestseller for the company, which manufactures organic personal care products.

Renaud says he's had to lay off five employees because of the ban and has lost up to a million dollars spent on marketing his product and providing research for Health Canada. "At the end of maybe, five, 10 years of fighting, [Heath Canada] gets all our energy," he says.

DEET passed Health Canada's scrutiny because the manufacturers provided the required safety data. But citronella — an extract from lemon grass —  has never been patented, which makes it an unattractive investment for costly studies.

"If the market was such that this product was generating millions of dollars, then the industry would have done something re-active to try and get [citronella] back on the market," said Kacew.

That's the problem with other essential oils as well. They may be effective as bug repellents, but no one has yet funded the studies to prove they're safe.

DIY bug spray

Tracey TieF made and sold a natural bug spray with essential oils including lavender and rosemary for seven years before Health Canada shut her down recently.

The problem was that she hadn't registered her product and done any safety studies.

"I can't afford to run my own trial," says the certified health practitioner. "I feel afraid and I feel sick about it, actually, because for me, this is a passion."

TieF now puts that passion into teaching others how to make natural bug sprays. In a tiny room at Karma Co-op in Toronto, she passes out bottles, essential oils and recipes. "I'll teach people until [Health Canada] stops me," she vows.

Aimee Alabaster says she joined the class because she wants a natural bug spray for her children. "Everything out there for the most part contains DEET, and I don't want to put DEET on my kids."

Research has suggested DEET could be harmful to the central nervous system. But Health Canada states on its website that "registered insect repellents containing DEET can be used safely when applied as directed."

Come 2015, citronella bug sprays won't be entirely out of reach, you will just have to cross the border. The product will still be available in the U.S.

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Canada plans legislation to end pay-to-pay billing fees

The federal government plans to introduce legislation that would halt the practice of charging fees for paper bills, an issue highlighted by the CRTC's criticism of Canadian telecom companies' pay-to-pay practices.

Industry Minister James Moore says the federal government is planning legislation that would end pay-to-pay billing fees - which are charged to customers who receive bills in the mail. (Sean Kilpatrick/Canadian Press)

Industry Minister James Moore said Friday that the government legislation will put an end to what he calls the unfair pay-to-pay fees.

Moore said Canadians expect lower prices and better service from telecom service providers. The government has twice promised to end pay-to-pay policies: In its October 2013 throne speech and in the 2014 budget.

Moore's announcement came a day after after executives from nearly a dozen major telecom companies — including Bell, Rogers and Telus — met with the Canadian Radio-television and Telecommunications Commission in Gatineau, Que.

The companies vowed to exempt some customers from pay-to-pay fees: 

• Seniors.
• Individuals with disabilities.
• Military veterans.
• Customers with no internet connections.

In a statement released after the meeting, regulators said the exemptions don't go far enough.

CRTC chair Jean-Pierre Blais said "many Canadians who will not benefit from the exemptions will be disappointed with the outcome so far."

Blais also praised the four companies — Cogeco Cable, MTS Allstream, SaskTel and Shaw Communications — that have opted not to charge for paper fees, saying "Canadians should keep this in mind when they select service providers."

According to a study released this week by the Public Interest Advocacy Centre, Canadians pay over $500 million a year in paper billing fees.

The advocacy group says low-income Canadians and seniors shoulder the heaviest burden, as they are less likely to have access to the internet. An estimated 15 per cent of Canadians do not have internet access at home. 

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Tesla Motors inks deal to build 400 charging stations in China

Tesla Motors Co. and a state-owned Chinese phone carrier announced plans Friday to build 400 charging stations for electric cars in a new bid to promote popular adoption of the technology in China.

Plans call for China Unicom Ltd. to provide space for construction and basic services in 120 cities while Tesla, based in Palo Alto, California, operates the stations. The two companies also will build 20 "supercharger stations" in 20 cities to offer high-speed charging.

Promoters of electric cars see China as a promising market due to Beijing's support for the technology and eagerness to reduce smog. But the lack of charging infrastructure in this vast country is seen as a major hurdle to winning general acceptance.

Tesla delivered its first U.S.-manufactured electric sedans to Chinese customers in April and CEO Elon Musk said then the company planned to invest several hundred million dollars to build a charging network in China.

Prior to Friday's announcement, Tesla had 200 charging points in China.

"This cooperation will accelerate the Tesla charging network nationwide," said a company spokeswoman, Peggy Yang, in an email.

Another automaker, Germany's BMW AG, announced plans in May to set up 50 charging stations in partnership with State Grid, China's biggest state-owned utility, and a real estate developer.

Chinese leaders want to develop an electric car industry and called in 2009 for annual sales of 500,000 electric cars by 2015 but have scaled back those plans. The country has about 78,000 electric vehicles on the road, mostly public buses and taxies.

Industry growth has been slow partly due to rules that limit market access unless foreign manufacturers share technology with Chinese partners that might become rivals.

In July, the government announced buyers of electric cars will be exempt from a 10 percent sales tax on automobiles.

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Why passengers are unlikely to win damages due to unruly fliers

Airline passengers who have their travel plans interrupted when unruly passengers force a plane to turn around or be diverted are likely to have a difficult time collecting damages for the disruption.

Those aboard Wednesday's Cuba-bound Sunwing flight that was forced to turn back to Toronto because of the alleged misbehaviour of two female passengers, reportedly received a $75 voucher from Sunwing for future trips and a $15 meal voucher at Pearson. 

The flight took off for a second time from Toronto around 11 p.m. Wednesday with a new flight crew.

But those who feel they deserve more compensation for having their vacation plans derailed, even temporarily, are probably out of luck.

Lilia Ratmanski, 25, of Whitby, Ont., left, and Melana Muzikante, 26, of Vaughan, Ont., appeared in court Thursday. They are charged with smoking on board an aircraft, endangering the safety of an aircraft, mischief endangering life, mischief over $5,000 and uttering threats. (Alex Tavshunsky/CBC)

Under Flights Rights Canada,  a six-point code of conduct that was created for Canada's airlines and voluntarily adopted by the major Canadian air carriers, nothing  "would make the airline responsible for acts of nature or the acts of third parties, according to the government website.

"Airlines are legally obligated to maintain the highest standards of aviation safety and cannot be encouraged to fly when it is not safe to do so."

In the case of this week's Sunwing flight, the pilot of the 737 aircraft described the two female passengers as disruptive "in a serious manner," and reported to NORAD (North American Aerospace Defence Command) while the plane was in U.S. airspace that the aircraft was "under threat."

NORAD scrambled two CF-18 fighter jets based out of Bagotville, Que., to escort Flight 656 back to Toronto. The women are facing a series of charges, including endangering the safety of an aircraft, smoking on an aircraft and uttering threats.

A passenger could try to seek further compensation from the airline, claiming that they believed the pilot overreacted. But John McKenna, president and CEO of the Air Transport Association of Canada, said "they wouldn't get very far."

"The pilot is captain on board," said McKenna. "He does what he deems necessary. No pilot likes to turn a plane around. It's his prerogative or her prerogative to do so if he or she thinks the safety of the passengers is at risk."

"But some people will try anything to get compensation."

Passengers could always try to launch civil legal action against those responsible for diverting the flight, but if the delay resulted in missing a day or a couple days of vacation, the time and effort in court would likely surpass any compensation they may receive.

However, trying to recoup expenses caused by the diversion may be worth it for the airline. Meaning, in this case, Sunwing could take action against the two accused. 

Indeed, the airline is currently seeking legal action against two members of a Cape Breton family accused of smoking on a flight to the Dominican Republic last year. Sunwing is suing the two, claiming their actions forced the plane to be diverted to Bermuda. The airline is suing for the damages and expenses incurred for having to divert, which include airport fees and landing fees.

In the current Sunwing case, the airline could sue or seek restitution as did Air Canada in a case against a Calgary man last year. The man's unruly behaviour forced a London-to-Calgary flight to land in Edmonton. He was given a one-year probation term, was fined $4,000 and was ordered to pay $15,200 in restitution to Air Canada.

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Canadian economy expands at 3.1% pace in 2nd quarter

Canada's economy soared in the second quarter, to an annualized pace of 3.1 per cent, as households spent more, marking the largest quarterly gain since the third quarter of 2011.

The jump in gross domestic product (GDP) was greater than the 2.7 per cent rate economists were expecting, and follows sluggish growth to start the year, the economy's worst performance in more than a year.

The jump came as the agency updated its result for the first quarter to an annual pace of 0.9 per cent compared with an earlier reading of 1.2 per cent in the first three months of the year.

Statistics Canada said Friday that real GDP was up by 0.8 per cent during the quarter ended June 30, compared to a 0.2 per cent increase in the first three months of  2014.

On a monthly basis, the economy grew in June by 0.3 per cent.

In a statement, Finance Minister Joe Oliver said the news is evidence the government's plan for the economy is working, and that "our unrelenting focus on jobs, growth and long-term prosperity is paying off for Canadians from coast to coast to coast."

Statistics Canada said economic activity increased in all sectors except non-profit institutions serving households.

Consumers led the increase, with household consumption up by 0.9 per cent for the three-month period ended June 30.

Canadians spent 1.2 per cent more on goods in the second quarter, and 0.7 per cent more on services.

Spending on housing showed a marked increase, with investment in residential structures up 2.9 per cent by quarter and home ownership transfer costs up by nine per cent after two previous quarters of decline.

Exports also rose by 4.2 per cent in the second quarter — the strongest performance since the third quarter of 2011 — after declining by 0.2 per cent in the first three months of the year.

"The Canadian economy looks to be firing on more cylinders after a particularly tough winter," writes TD Bank senior economist Randall Bartlett in a note to investors.

He also finds positive signs for the future, writing that momentum in the second half of the year is also "strong."

"If this begins to translate into stronger employment and wage growth in the Canadian labour market, it will work to further reinforce our view that the Bank of Canada will raise interest rates in the second half of 2015," Bartlett added.

In the United States, annualized GDP grew by 4.2 per cent in the second quarter after contracting by one per cent in the first quarter.

Despite the positive report, the S&P/TSX traded lower to start the day, down 17.8 points to 15,540 points in the early morning. The decline was partly due to lower-than-expected consumer spending in the U.S. dragging down U.S. markets.

The Canadian dollar rose slightly by 0.13 cents US to 92.2 cents in Friday morning trading.

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Tim Hortons hitched, Shomi born, Twitch adopted and NHL expecting: BUSINESS WEEK WRAP

The biggest news of the week came right at the beginning, with reports that Burger King and Tim Hortons were working out a deal. A day later, they made it official.

The two chains will unite under a new holding company based in Canada. Both of the brands will continue to operate the same way, so you won't have to order your double double with a Whopper.

Tim Hortons' interest in the deal? A chance to significantly expand south of the border, an elusive goal that they haven't been able to achieve after years of trying. A goal that won't come at the expense of the company's Canadian presence.

"We're going to keep all of the fantastic things we've done in Canada, we're going to build on that. But this brand deserves to go around the world", said Tim Hortons CEO Marc Caira in an interview on The Exchange with Amanda Lang.

For the Timmies faithful who are worried the chain will change under new ownership, Tim's took out a two-page ad in major Canadian newspapers assuring them their double-doubles will stay the same.

Competing with Netflix

Rogers and Shaw are teaming up to launch a Netflix-like streaming site in Canada. It's called Shomi, and the two telecom giants are bringing it to Canadians in November.

The service will offer 340 TV series and 1,200 movies, with 30 per cent Canadian content, and cost $8.99 per month, similar to the cost of a Netflix subscription.

At launch, the service will only be available to Shaw and Rogers TV and internet subscribers for what's being called a 'beta period' of six months to one year, at which point non-subscribers will be able to get their hands on it.

They'll have their work cut out for them in competing with Netflix, as one-third of English-speaking Canadians already subscribe to the U.S. company's service.

Betting on video game streaming

It's not just Rogers and Shaw looking to capitalize on people's desire for streaming content. Amazon is spending $970 million to buy Twitch, a site where users watch live streaming video of other people playing video games.

Why would the online retailer bet nearly $1 billion that users want to watch people play games, rather than be playing themselves? Because it works.

The site accounts for more than 43 per cent of all U.S. live streaming traffic, according to analysis by online video analytics site Qwilt. On an average night, Twitch has a viewing audience roughly the same size as popular U.S. cable channels like Comedy Central and MTV.

Games are also growing quickly as a spectator sport, with international competitions attracting millions of viewers — all through Twitch.

NHL expansion rumours

From digital sports to a more traditional kind, hockey fans in Las Vegas, Seattle, Quebec and Toronto were given reason to get their hopes up as reports circulate that new NHL teams might be coming to town as part of a big expansion push.

It's been 14 years since the league added teams in Minnesota and Columbus, and the addition of four new teams could put as much as $1.4 billion dollars into the owners' pockets through expansion fees.

The NHL is staying quiet, and likely wouldn't say anything until a final announcement is made. But Glen Hodgson, Chief Economist of the Conference Board of Canada and author of Power Play: The Business Economics of Pro Sports says there are several markets that could handle an expansion team, including Toronto.

In an interview with The Exchange, Hodgson said "there's no doubt that Toronto is a big enough market right now to have two even three NHL teams. and the market's going to grow over the next 20 years".

Those were some of the most-read stories on our website this week. Be sure and check back often for more news, and remember to follow us on Twitter here.

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Malaysia Airlines cuts 30% of employees in bid to save company

Malaysia Airlines will cut almost a third of its 20,000-person workforce and cut back its global route network as part of a radical $1.9-billion US restructuring after two devastating jetliner disasters.

The 42-year-old company will be delisted from the stock market by the end of the year under the broad revival plan announced Friday. The plan aims to make the airline more efficient and to raise its services to global standards.

"Estimation of a workforce of approximately 14,000 represents a net reduction of 6,000, or a net reduction of 30 per cent from approximately 20,000 current staff in total," said Azman Mokhtar, managing director of the Malaysian government's investment fund, which owns a majority stake in the airline.

The 6,000 job cuts were more than expected by the industry and mark a painful new blow for staff after a traumatic year for the national flag-carrier and the Southeast Asian country.

The national investment fund, Khazanah Nasional, currently holds a 69 per cent stake in the airline, and said it would invest in "reskilling" those who lose their jobs. It pledged to set up a panel to improve often rocky relations between unions and management.

Khazanah will take 100 per cent ownership when the carrier is delisted and said that it would buy out minority shareholders.

"The assignment and the object of this exercise is to support the revival of the national carrier but not at any cost; this is the key actually," Mokhtar said.

Under the restructuring plan, which was approved by Malaysia's cabinet this week, the airline's assets and liabilities will be transferred to a new company with Khazanah injecting up to $1.9 billion US.

Khazanah aims to return Malaysian Airlines to profit by 2017, and relist the company within five years, by which time it would be a more regionally focused airline "with lower cost structure and greater emphasis on revenue yield management," the state fund said in a statement.

An international search for a new chief executive was underway, Khazanah said, and the current one, Ahmad Jauhari Yahya, would stay on until July next year.

Khazanah said its new fund injections would be strictly tied to the new company meeting performance targets.

The state fund did not give details on plans to reduce the carrier's flight network, but said several of its European destinations would be reviewed. Malaysia Airlines will retain global flight connectivity through the Oneworld alliance and code-sharing, Khazanah said.

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Why passengers are unlikely to win damages due to unruly fliers

Airline passengers who have their travel plans interrupted when unruly passengers force a plane to turn around or be diverted are likely to have a difficult time collecting damages for the disruption.

Those aboard Wednesday's Cuba-bound Sunwing flight that was forced to turn back to Toronto because of the alleged misbehaviour of two female passengers, reportedly received a $75 voucher from Sunwing for future trips and a $15 meal voucher at Pearson. 

The flight took off for a second time from Toronto around 11 p.m. Wednesday with a new flight crew.

But those who feel they deserve more compensation for having their vacation plans derailed, even temporarily, are probably out of luck.

Lilia Ratmanski, 25, of Whitby, Ont., left, and Melana Muzikante, 26, of Vaughan, Ont., appeared in court Thursday. They are charged with smoking on board an aircraft, endangering the safety of an aircraft, mischief endangering life, mischief over $5,000 and uttering threats. (Alex Tavshunsky/CBC)

Under Flights Rights Canada,  a six-point code of conduct that was created for Canada's airlines and voluntarily adopted by the major Canadian air carriers, nothing  "would make the airline responsible for acts of nature or the acts of third parties, according to the government website.

"Airlines are legally obligated to maintain the highest standards of aviation safety and cannot be encouraged to fly when it is not safe to do so."

In the case of this week's Sunwing flight, the pilot of the 737 aircraft described the two female passengers as disruptive "in a serious manner," and reported to NORAD (North American Aerospace Defence Command) while the plane was in U.S. airspace that the aircraft was "under threat."

NORAD scrambled two CF-18 fighter jets based out of Bagotville, Que., to escort Flight 656 back to Toronto. The women are facing a series of charges, including endangering the safety of an aircraft, smoking on an aircraft and uttering threats.

A passenger could try to seek further compensation from the airline, claiming that they believed the pilot overreacted. But John McKenna, president and CEO of the Air Transport Association of Canada, said "they wouldn't get very far."

"The pilot is captain on board," said McKenna. "He does what he deems necessary. No pilot likes to turn a plane around. It's his prerogative or her prerogative to do so if he or she thinks the safety of the passengers is at risk."

"But some people will try anything to get compensation."

Passengers could always try to launch civil legal action against those responsible for diverting the flight, but if the delay resulted in missing a day or a couple days of vacation, the time and effort in court would likely surpass any compensation they may receive.

However, trying to recoup expenses caused by the diversion may be worth it for the airline. Meaning, in this case, Sunwing could take action against the two accused. 

Indeed, the airline is currently seeking legal action against two members of a Cape Breton family accused of smoking on a flight to the Dominican Republic last year. Sunwing is suing the two, claiming their actions forced the plane to be diverted to Bermuda. The airline is suing for the damages and expenses incurred for having to divert, which include airport fees and landing fees.

In the current Sunwing case, the airline could sue or seek restitution as did Air Canada in a case against a Calgary man last year. The man's unruly behaviour forced a London-to-Calgary flight to land in Edmonton. He was given a one-year probation term, was fined $4,000 and was ordered to pay $15,200 in restitution to Air Canada.

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Canadian economy expands at 3.1% pace in 2nd quarter

Canada's economy soared in the second quarter, to an annualized pace of 3.1 per cent, as households spent more, marking the largest quarterly gain since the third quarter of 2011.

The jump in gross domestic product (GDP) was greater than the 2.7 per cent rate economists were expecting, and follows sluggish growth to start the year, the economy's worst performance in more than a year.

The jump came as the agency updated its result for the first quarter to an annual pace of 0.9 per cent compared with an earlier reading of 1.2 per cent in the first three months of the year.

Statistics Canada said Friday that real GDP was up by 0.8 per cent during the quarter ended June 30, compared to a 0.2 per cent increase in the first three months of  2014.

On a monthly basis, the economy grew in June by 0.3 per cent.

In a statement, Finance Minister Joe Oliver said the news is evidence the government's plan for the economy is working, and that "our unrelenting focus on jobs, growth and long-term prosperity is paying off for Canadians from coast to coast to coast."

Statistics Canada said economic activity increased in all sectors except non-profit institutions serving households.

Consumers led the increase, with household consumption up by 0.9 per cent for the three-month period ended June 30.

Canadians spent 1.2 per cent more on goods in the second quarter, and 0.7 per cent more on services.

Spending on housing showed a marked increase, with investment in residential structures up 2.9 per cent by quarter and home ownership transfer costs up by nine per cent after two previous quarters of decline.

Exports also rose by 4.2 per cent in the second quarter — the strongest performance since the third quarter of 2011 — after declining by 0.2 per cent in the first three months of the year.

"The Canadian economy looks to be firing on more cylinders after a particularly tough winter," writes TD Bank senior economist Randall Bartlett in a note to investors.

He also finds positive signs for the future, writing that momentum in the second half of the year is also "strong."

"If this begins to translate into stronger employment and wage growth in the Canadian labour market, it will work to further reinforce our view that the Bank of Canada will raise interest rates in the second half of 2015," Bartlett added.

In the United States, annualized GDP grew by 4.2 per cent in the second quarter after contracting by one per cent in the first quarter.

Despite the positive report, the S&P/TSX traded lower to start the day, down 17.8 points to 15,540 points in the early morning. The decline was partly due to lower-than-expected consumer spending in the U.S. dragging down U.S. markets.

The Canadian dollar rose slightly by 0.13 cents US to 92.2 cents in Friday morning trading.

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Wine, spirits to move more easily between B.C., Saskatchewan

Live

Christy Clark, Brad Wall to drop barriers to consumers buying direct from producers

By Susan Lunn, CBC News Posted: Aug 29, 2014 9:25 AM ET Last Updated: Aug 29, 2014 11:26 AM ET

Sask. and B.C. have liquor deal 3:07

Sask. and B.C. have liquor deal 3:07

British Columbia Premier Christy Clark and Saskatchewan's Brad Wall agreed today to lift barriers to allow consumers in both provinces to order wines and craft spirits directly from producers, and have them delivered to their door.

"We still need to hammer out all the fine details but broadly it will mean it is no longer illegal to bring B.C. wine into Saskatchewan or Saskatchewan wine into British Columbia for personal use," Clark said Friday morning.

The premiers are holding a closing news conference at 11:30 a.m. ET. CBCNews.ca is carrying the event live.

"We're also going to go a little bit further and ensure craft spirits — the craft spirits industry in British Columbia and in Saskatchewan is growing very quickly — make that legal for individuals to import between our provinces."

Wall has been promoting in particular a dill pickle vodka from the Last Mountain distillery to his colleagues.

Clark says today's announcement is the first of many more across the country.

"Manitoba has now made it possible. Nova Scotia is very close to finishing their regulations which will allow it to be possible. Saskatchewan is now on track."

Ontario premier Kathleen Wynne has told reporters that she is interested in a similar deal for her province.

The wine part of the deal between B.C. and Saskatchewan will take effect by the end of the year. Wall hopes the craft spirits will be able to move more freely between the two provinces by June 2015.

The premiers made the announcement at their annual summer meeting in Charlottetown.

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The House

• Premiers on collision course with Ottawa ahead of the 2015 federal election Aug. 29, 2014 2:01 PM Evan Solomon hosts a special edition of The House from the premiers' summer meeting. BC's Christy Clark, Saskatchewan's Brad Wall, Ontario's Kathleen Wynne, PEI's Robert Ghiz and Quebec's Philippe Couillard all join us. Plus, outgoing NATO head Anders Fogh Rasmussen is in for a feature conversation.

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Regulator battles telecom companies over 'pay-to-pay' billing fees

Canada's big telecom companies say they will keep charging customers additional fees for producing and mailing paper bills, with some exceptions.

The announcement came after executives from nearly a dozen major telecom companies — including Bell, Rogers and Telus — met with the Canadian Radio-television and Telecommunications Commission (CRTC) for an all-day meeting in Gatineau, Que.

The companies said they would exempt these groups from paper billing (pay-to-pay) fees:

• Seniors.
• Individuals with disabilities.
• Military veterans.
• Customers with no internet connections.

But in a statement released after the meeting, regulators say that doesn't go far enough.

CRTC chair Jean-Pierre Blais said "many Canadians who will not benefit from the exemptions will be disappointed with the outcome so far."

A consumer advocacy group says Canadians are paying hundreds of millions of dollars a year in paper bills from telecom companies. This week, telecom giants said they would exclude seniors, veterans and certain other groups from such fees, but the CRTC says that's not good enough. (CBC)

Blais also praised the four companies — Cogeco Cable, MTS Allstream, SaskTel and Shaw Communications — that have opted not to charge for paper fees, saying "Canadians should keep this in mind when they select service providers."

The broadcast regulator had urged participants prior to the meeting to make firm decisions about the fees they charge, with an eye toward eliminating them altogether.

The federal government has twice promised to end pay-to-pay policies: In its October 2013 throne speech and in the 2014 budget.

According to a study released this week by the Public Interest Advocacy Centre, Canadians pay over $500 million a year in paper billing fees.

The advocacy group says low-income Canadians and seniors shoulder the heaviest burden, as they are less likely to have access to the internet. An estimated 15 per cent of Canadians do not have internet access at home. 

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EU lawmakers threaten to scrap Canada-EU trade deal

EU lawmakers are threatening to block a multi-billion dollar trade pact between Canada and the European Union — a blueprint for a much bigger EU-U.S. deal — because it would allow firms to sue governments if they breach the treaty.

The agreement with Canada, a draft of which was seen by Reuters, could increase bilateral trade by one fifth to $37 billion (26 billion euros).

But European consumer and environmental groups say a mechanism in the accord would allow multinationals to bully the EU's 28 governments into doing their bidding regardless of environmental, labour and food laws and would set a bad precedent for the planned EU-U.S. trade pact.

The European Parliament must ratify both the Canada and the U.S. pacts. Since elections in May, the rise of nationalist, Eurosceptic parties in the legislature, many of them opposed to globalization, have complicated the EU's free-trade ambitions.

"The Greens will fight hard to get a majority in the parliament against (the EU-Canada deal)," said Claude Turmes of the Green group, echoing concerns from others in the European Parliament, including the Socialist bloc.

Deal an "affront to democracy"

Tiziana Beghin, an EU lawmaker from Italy's anti-establishment 5-Star Movement who sits on the parliament's influential trade committee, called the EU-Canada deal an "affront to democracy".

"Giving corporations the right to sue governments for loss of anticipated profit would be ridiculous if it were not so dangerous," she told Reuters.

According to the draft accord, the chapter on "Investor-State Dispute Settlement" (ISDS) allows companies to sue either an EU country or Canada in a special court if they think their trade interests have been damaged.

Some member states, including Germany, the EU's biggest economy, have also expressed opposition to the ISDS.

Canada and the European Commission deny accusations that the ISDS mechanism will give multinationals too much power. They say dispute settlement has been an important part of trade deals since the North American Free Trade Agreement 20 years ago.

Some in business consider it an insurance policy against the impact of laws on their profits or against expropriation.

Negative signal

In the European Parliament, it is not yet clear whether there is enough opposition to block the EU-Canada deal, but the very fact such threats are being made indicates the change in tone from the previous, more business-friendly parliament.

Together with the Socialists' 191 members, the political groups opposing the agreement could count on 341 votes, just 35 short of a majority.

Passing the accord is likely to depend on centrist parties forming a grand coalition and much will depend on how the Socialists, who say they oppose the dispute mechanism, vote.

In 2012 the EU Parliament flexed its muscles by rejecting an Anti-Counterfeiting Trade Agreement, which would have set global standards for enforcement of intellectual property rights.

Blocking the Canada trade deal would send a very negative signal on the chances of the even more ambitious EU-U.S. accord, which if approved would encompass almost half of the global economy and about a third of world trade.

"This issue is very important since the accord with Canada with the arbitration clause would foreshadow a deal with the United States," said French far-right leader Marine Le Pen.

Hostility to the dispute settlement panel has united those such as Le Pen, who see it as a threat to national sovereignty, and those worried about the implications for environmental law.

Dutch Green MEP Bas Eickhout said the draft deal would "open the backdoor" for firms to kill off environmental legislation.

The EU and Canada hope to sign the accord — officially known as the Comprehensive Economic and Trade Agreement (CETA)— at an Ottawa summit on Sept. 25-26, officials said. It must still be ratified by both the EU and Canadian parliaments.

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'It's genuinely beloved': Why Canadians continue to crush on Tim Hortons

Picture the richest best-dressed company director and the poorest worst-dressed unemployed worker — both could be seen holding a cup of Tim Hortons coffee in their hand and neither would feel awkward. 

"Could you do that with Starbucks? Could you do that with other brands? Tim's is every man and every woman, and that's its power," said Alan Middleton, a York University assistant marketing professor.

That observation, which Middleton says was originally made by cultural anthropologist Grant McCracken, helps to explain the enduring love affair that Canadians have with the coffee and doughnut giant.

And it's a love affair that's provably true, says Middleton, who specializes in domestic and international branding and is the executive director of the Schulich Executive Education Centre.

"It's genuinely beloved," Middleton said. 

To allay any fears Canadians may have over the announcement of the merger with Burger King, Tim Hortons took out a two-page newspaper ad on Wednesday promising that a Tim Hortons coffee before and after the deal will remain the same. 

What the ad didn't point out is that Tims has been owned by American-based interests before. Wendy's International bought the chain in 1995 and hung on to it until 2006 when it was spun off as a separate public company. But analysts say Tim's ownership hasn't seemed to matter to Canadians and hasn't affected the chain's Canadian identity.   

While it's the biggest coffee chain in Canada, with more than 3,600 stores across the country, Tim Hortons consistently ranks high in brand studies, he says, and qualitative and quantitative research shows that Canadians believe the company is reflective of Canada.

Its community work, sponsoring local sporting clubs has earned it a number of sponsorship awards, while its work in student programs and the Tim Horton Children's Foundation have engendered an enormous amount of goodwill.

Interbrand Canada, a leading brand consultancy firm, annually ranks the best Canadian brands based on financial analysis, the role of the brand in consumer purchasing decisions and brand strength. This year, Tim Hortons came in fifth but it was the highest ranking retail brand in their top 25, which Interbrand Canada managing director Carolyn Ray attributes in large part to Tim Hortons' ''authenticity."

Among the highest in 'authenticity'

"Authenticity is about your heritage and your values and being true to who you are and I think Tim Hortons, certainly in the retail sector, scored among the highest in authenticity," Ray said. "Which means all the things they do in the community and all the things they deliver from a customer service perspective are viewed by consumers as authentic."

Authenticity, or being relatable to consumers, is different than Canadians having some kind of strong patriotic attachment to the brand. Middleton dismissed the notion that Canadian ties to the company, founded by Toronto Maple Leaf hockey player Tim Horton, come from any profound sense of nationalism. There are certainly tinges of pride, but it's not overt.

"We don't do well in responses to nationalism," he said.

The Molson Canadian beer "I am Canadian" rant commercial, in which average Canadian Joe talks about why it's great to be Canadian, is a perfect example, he said.

Author Douglas Hunter believes Tim Hortons became a Canadian cultural phenenomenon in part because of the CBC's Royal Canadian Air Farce doughnut shop sketches.

"The individual commercial was huge but when they tried to turn it from the Molson Canadian brand to an ongoing campaign, it failed," he said. "We don't buy based on nationalism. We buy based on 'this company kinda gets us.'"

Middleton credits Tim Hortons' success on a combination of its strong roots in communities, its ability to cater to consumer wants while introducing new products and its marketing and advertising strategy.

While some of Tim Horton's tearjerker "True Stories" commercials may resonate with Canadians and are important, most of the company's advertising goes toward highlighting the products they offer, Middleton said.

Have a 'value' proposition

"They constantly communicate what the product's good for, what the beverage is good for and that it's good value. So they have a value proposition," Middleton said. 

Douglas Hunter, author of Double Double: How Tim Hortons Became a Canadian Way of Life, One Cup at a Time, said Tim Hortons has been very shrewd about not building up their own self importance.

"They've done good marketing around people telling their own stories. They've let people tell their own stories. It's always dangerous for a company to tell you 'I'm really important to you and your identity.'"

Former Ontario PC Leader Tim Hudak was among a number of politicians who made regular campaign stops at Tim Hortons. (Chris Young/Canadian Press)

Hunter believes Tim Hortons became a Canadian cultural phenomenon in part because of the CBC's Royal Canadian Air Farce doughnut shop sketches, which featured characters sitting around a table at a coffee shop, riffing on the events of the day. Although the sketches never specifically referred to Tim Hortons, the coffee chain was the major player in Canada at the time.

"If you were thinking of a coffee doughnuts store, you really were thinking about Tim Hortons," he said. "And I think it did come out of that doughnut gang idea. We really started to equate this idea that ordinary, mushy, middle-class, middle-spectrum political values Canadians go to Tim Hortons and meet and talk about the day."

From that perception grew a new political reality, said Hunter, where Tim Hortons was the place where you met "ordinary Canadians" and was the only place that politicians could be seen meeting Canadians.

"Have we jumped the shark on that yet? I don't know. I kind of thought that we had. Even in 2012, when I was [touring] the book, I was still seeing media shorthand of  'the Tim Hortons voters.' I thought 'why do we keep talking about the Tim Hortons' voter?' I think people just go to Tim Hortons."

The "Tim Hortons" voter may just be part of the Canadian lexicon, much like "double double" and "roll up the rim" have all become familiar phrases.

"It's the difference between calling it Tim Hortons and Tim's," said Middleton, the marketing professor. "Brands would die for that crossover affection."

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JPMorgan investigates possible cyberattack by Russian hackers

JPMorgan Chase & Co. says it is working with law enforcement to investigate a possible cyberattack. Bloomberg reported the attack may be part of a co-ordinated attack by Russian hackers triggered by U.S. sanctions against Russia. (Paul Sakuma/Associated Press)

JPMorgan Chase & Co is investigating a possible cyberattack and working with law enforcement to determine the scope, company spokeswoman Trish Wexler said.

The announcement comes after the FBI said Wednesday it's working with the Secret Service on the recently reported cyberattacks against several U.S. financial institutions.

Earlier, Bloomberg.com reported that Russian hackers attacked the U.S financial system this month, possibly in retaliation against U.S. government-sponsored sanctions aimed at Russia.

The attack, Bloomberg said, led to the loss of sensitive data.

Bloomberg cited security experts saying the attack appeared "far beyond the capability of ordinary criminal hackers."

Additionally, the New York Times, citing people familiar with the matter, reported at least four other firms in addition to JPMorgan were hit this month by co-ordinated attacks that siphoned off huge amounts of data, including chequing and savings account information.

Wexler says JPMorgan is taking additional steps to safeguard sensitive or confidential information, though it not seeing unusual fraud activity at this time, she said.

JPMorgan is the largest bank in the U.S. by assets.

The FBI said in a statement that fighting cyber threats and criminals remains a top priority for the U.S. government, and it's "constantly working with American companies to fight cyberattacks."

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TD Bank profit jumps to $2.1 billion

TD Bank is reporting profit of $2.1 billion in its third quarter, up 38 per cent from the same period a year ago. (Mark Blinch/Reuters)

TD Bank reported a higher third-quarter net profit of $2.1 billion, with strong results from its Canadian retail banking operations.

The bank earned $1.11 per share, compared with $1.52 billion, or 79 cents per share, in the same quarter last year.

Adjusted net income was $2.16 billion, or $1.15 per share, compared with an adjusted net income of $1.58 billion, or 82 cents per share. Total revenue was $7.5 billion compared with $7.1 billion year-over-year.

Analysts had been expecting $1.09 in adjusted earnings per share, according to data compiled by Thomson Reuters.

The bank says its Canadian retail operations had a net income of $1.4 billion for the third quarter, a 54 per cent increase in adjusted earnings over the same quarter last year, driven by such factors as good loan and deposit growth, contributions from Aeroplan and higher wealth assets.

Loyalty rewards company Aimia Inc., which owns and operates the Aeroplan rewards program in Canada, now has TD Bank as its main partner as the issuer of Aeroplan credit cards.

The bank's U.S. retail operations generated net income of US$518 million, an increase of four per cent compared with the third quarter last year.

Its wholesale banking segment, which provides services to corporate clients and financial institutions, had net income for the quarter was $216 million, an increase of 46 per cent compared with the third quarter last year.

Provisions for credit losses was $338 million compared with $477 million in the same quarter of 2013.

TD Bank also says its insurance earnings had a rebound from last year when the business was affected by severe weather-related impacts and increased general insurance claims.

The bank's return on equity was 16.3 per cent versus 12.8 per cent year-over-year.

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Premiers turn to trade on Day 1 of meetings

Canada's premiers have kicked off their annual meeting in Charlottetown, and the leaders of British Columbia, Saskatchewan and Alberta are already promising to review their regional trade agreement to see what barriers remain between their provinces.

Premier Robert Ghiz, who is hosting this year's Council of the Federation meeting, is scheduled to talk to reporters at 11:30 a.m. ET, following comments by New Brunswick Premier David Alward and B.C. Premier Christy Clark. CBCnews.ca will carry the press conferences live.

Earlier Thursday, Clark, Saskatchewan Premier Brad Wall and Alberta's Dave Hancock started the day by announcing they're going to take a look at the New West Partnership to see if regulations are preventing trade opportunities.

Wall said, for example, that if a company wants to make first aid kits for Canada, that business would have to satisfy 10 different sets of regulations as to what might constitute a first aid kit.

"So this seems dumb and I think at the heart of improving trade issues is trying to remove dumb from the economy," Wall said.

British Columbia Premier Christy Clark, along with the premiers of Saskatchewan and Alberta, said they'll review regulations to try to knock down more trade barriers between their provinces. (Andrew Vaughan/Canadian Press)

Clark said all of the provinces have room to improve trade, but pointed to the federal government, too, and said she wants to help it understand all the things it can do to increase trade.

"We know that trade barriers kill jobs. We know that red tape gets in the way of putting people to work across the country. And it doesn't make any sense to any of us that we should be putting artificial barriers in the way of creating jobs, because a job that's created in Saskatchewan is also of benefit to people who live in PEI," she said.

While the agenda is expected to focus on trade, the premiers are also expected to talk about Canada's aging population, health-care and pensions.

The 13 premiers, who met Wednesday with native leaders, started their day with a photo-op, walking down the rain-slicked street in front of the provincial legislature, where they dropped their umbrellas and posed for a group photo.

Ghiz reminded the premiers that it was in Charlottetown 150 years ago that the premiers from the Maritimes and two Canadian provinces gathered for a conference that cemented the idea of Confederation.

The meeting wraps up Friday.

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Christine Lagarde, IMF chief, in French corruption probe

International Monetary Fund head Christine Lagarde was placed Wednesday under official investigation for negligence in a French corruption probe that dates back to her days as France's finance minister.

Calling the allegations "without basis" Lagarde said she would return to her work in Washington after a fourth round of questioning by French magistrates.

The IMF chief and a former chief of staff are being probed about a payment to businessman Bernard Tapie worth more than $500 million while she was finance minister about a half-decade ago.

Tapie was paid the sum in arbitration over a dispute between French bank Credit Lyonnais during the bungled sales of sportswear firm Adidas in the early 1990s.

Critics say the payment was part of a boondoggle and a symptom of the too cozy relationship between business and the French government at the time.

The payment was made much later, when Lagarde was in power.

"After three years of proceedings, dozens of hours of questioning, the court found from the evidence that I committed no offence, and the only allegation is that I was not sufficiently vigilant," she said in her statement.

Under French law, the official investigation is equivalent to preliminary charges, meaning there is reason to suspect an infraction. Investigating judges can later drop a case or issue formal charges and send it to trial.

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Veterans groups say Ottawa spending too much remembering old wars

A growing number of Canadian veterans' groups are upset that the federal government is spending millions commemorating old wars while current veterans are suffering from post-traumatic stress and other issues that they say are not being dealt with.

"I think it's obscene," said Michael Blais, the president of Canadian Veterans Advocacy after attending a small, private ceremony in Ottawa to remember soldiers who took their own lives. There has been a recent spate of soldier suicides.

The CVA, along with other veterans' groups, believe that commemoration is important, but that it is not what matters most right now.

They want the many ceremonies that Ottawa sponsors downsized so the federal government can provide more money for veterans who are currently suffering from the ravages of war.

"The bottom line, the government's failing their obligation to those who are living as a consequence of the money they're spending on the dead," says Blais.

2014 marks the centennial of the start of the First World War and the 75th anniversary of the start of the Second World War. 

The government has plans for military commemorations leading all the way to the anniversary of the end of the Second World War in 2020, a series of events that follows on the heels of its high-profile campaign to commemorate the War of 1812.

Millions add up

The spending does add up. From 2010 to 2015, Canadian Heritage has either spent or budgeted almost $40 million on programs relating to the World Wars and the War of 1812, according to information obtained by the opposition Liberals through an access to information request.

'What we have now is a government that's just looking for photo ops and headlines.'-Michael Blais, president of Canadian Veterans Advocacy

National Defence has set aside at least $27.5 million for war commemoration from now until 2020. 

Plus, Veterans Affairs has budgeted about $80 million over the next two years for remembrance activities that include the World Wars.

"What we have now is a government that's just looking for photo ops and headlines, and commemoration is one great headline," said Blais.

The former soldier said the money saved from scaled-back commemorations could be redirected to help current veterans suffering from post-traumatic stress disorder (PTSD) and other injuries, and provide them with more financial assistance.​

Some high-profile watchdogs are also concerned about veterans' care. On Wednesday, Veterans ombudsman Guy Parent and Canadian Forces ombudsman Gary Walbourne pledged to work together to look into how veterans are treated in their transition back into civilian life.

Many soldiers, wounded in Afghanistan and too ill to continue serving, have found upon release that the veterans bureaucracy requires them to validate their condition by visiting different doctors.

In some instances, they have been denied benefits for injuries that cost them their careers.

Canadian Forces members salute during the National Day of Honour on Parliament Hill in Ottawa on Friday, May 9, 2014.. The commemoration honoured the soldiers who participated in the war in Afghanistan and included many of the family members of the 158 soldiers who died in the 12-year conflict. (Justin Tang/Canadian Press)

The government points out that less than 1.5 per cent of the Veterans Affairs budget is spent on commemoration, and says that serving the needs of veterans is the department's top priority.

"Our government believes it is our responsibility to honour and remember the bravery and sacrifice of those who have served our country," said Ashlee Smith, spokesperson for Veterans Affairs. 

In 2011, the government said it would cut more than $226 million from Veterans Affairs' budget because of a dwindling number of veterans.

Last year, after an assessment of government services,  the veterans ombudsman concluded that ex-soldiers, the most severely disabled in particular, are receiving inadequate compensation for their pain and suffering under the controversial new funding plan that was initiated in 2006.

'When you cut money towards the veterans then your priorities are skewed'- Veteran Bruce Moncur

Today, more and more of these veterans are willing to tell their own stories.

Bruce Moncur feels he's still at war but, this time, it's with Veterans Affairs.

In 2006, while serving in Afghanistan, he was hit in the head with shrapnel in a friendly fire incident, and he lost five per cent of his brain.

The 30 year old still suffers from fatigue, short-term memory loss and PTSD. "Fifty per cent of my PTSD comes from my time in Afghanistan, and fifty per cent of my PTSD comes from the treatment I've received [from Veteran Affairs] since I've come home," he said.

After almost 10 years in the military, Moncur can no longer serve because of his injuries. He said Veterans Affairs gave him a lump sum pension of $22,000, which he calls "a pittance." He's been fighting his claim now for eight years.

Veterans Affairs reviewed Moncur's claim a year ago and didn't change its initial assessment. He says the department has now agreed to conduct a full internal review of his situation, but Veterans Affairs won't comment upon that aspect of his case. 

Cutbacks close offices

Moncur also has to grapple with the fact that earlier this year, Veterans Affairs closed eight district offices including his location in Windsor.

He now has to travel for an hour and a half each way to London to meet with his caseworker. "When you cut money towards the veterans then your priorities are skewed," says Moncur.  

"They're spending hundreds of millions of dollars on remembrance," he says. "While it is admirable, lists of priorities need to be made and maybe the commemorations need to be a little bit lower on the to-do list in this country." 

He said he knows many veterans who are also suffering, and suggested the government could lump commemorative events together. The money saved, he said, "could be used in better spots such as keeping Veterans Affairs offices open across the country."

"It's hard to explain to a veteran when he's losing his local office and they're spending millions of dollars on something else," said Tom Eagles.

The national president of The Royal Canadian Legion also believes the government needs to scale back commemoration events.

"We're all in favour of what they're doing in regard to honouring our men and women, but I think there has to be a happy balance somewhere."

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Cameco issues lockout notice at 2 uranium facilities

Some 535 Cameco workers at the Saskatchewan company's McArthur River and Key Lake facilities could be affected by a strike or lockout. (Cameco)

Cameco is halting production at two of its Saskatchewan uranium operations over a labour-management dispute.

The Saskatoon-based company has initiated a shutdown at the McArthur River uranium mine as well as the Key Lake mill. 

The company says the union representing employees, United Steelworkers Local 8914, has given strike notice for Saturday night. 

In response, Cameco has issued lockout notice for that same time. 

It's shutting things down now to ensure safety, it says. Cameco says any labour disruption is not expected to affect its 2014 uranium delivery commitments to customers.

There are 535 unionized workers at the two operations. 

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120 quakes rock Iceland's rumbling volcano

Concerns grow that eruption could spew volcanic ash that interferes with air traffic

The Associated Press Posted: Aug 27, 2014 9:12 AM ET Last Updated: Aug 27, 2014 9:12 AM ET

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Earthquakes are rocking Iceland's Bardarbunga volcano, adding to concerns that magma movements may trigger an eruption that could hinder air traffic.

Iceland's Met Office says two earthquakes measuring over magnitude 5 shook the volcano under the vast Vatnajokull glacier on Wednesday. Some 500 quakes have hit the area since midnight.

Iceland's aviation alert level remains at orange, the second highest.

Staff at Iceland's Meterological Office in Reykjavik monitor seismic activity from the Bardarbunga volcano. (Halldor Kolbeins/AFP/Getty Images)

On Sunday, the Met Office lowered the alert level, saying there was no sign of an imminent eruption at Bardarbunga.

In 2010, Iceland's Eyjafjallajokul volcano erupted and sparked off a week of international aviation chaos. Some 100,000 flights were cancelled after aviation officials closed Europe's air space for five days out of fear that volcanic ash could harm jet engines.

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CloudDX makes final cut in $10M Tricoder XPrize contest

Sonny Kohli shows off the Pulse Wave device. CloudDX's Tricorder device could be an extension of what that diagnostic product can already wirelessly do. (YouTube screengrab)

A tiny company from Mississauga, Ont., has made the final cut of companies competing to make a science fiction dream a reality and win the $10-million Qualcomm Tricorder XPrize.

CloudDX is among 10 finalists for the 3-1/2-year-old prize, which aims to develop a consumer-focused, mobile device capable of diagnosing and interpreting a set of 15 medical conditions and capturing five vital health metrics.

Picture the gizmo from Star Trek, where doctors would wave a wireless contraption over a sick person and the machine could instantly diagnose what's wrong with them, non-invasively. That's what companies competing for the prize are trying to create.

"As we move to the final stage of this process, we are one step closer to putting health care in the palm of your hand," said Grant Campany, senior director of the Qualcomm Tricorder XPrize.

The 10 finalists (and employees involved), in alphabetical order, are:

• Aezon (Rockville, Md.), led by Tatiana Rypinski, a team of student engineers from Johns Hopkins University partnering with the Center for Bioengineering Innovation & Design.
• CloudDX (Mississauga, Canada), a team from medical devices manufacturer Biosign and led by company chief medical officer, Dr. Sonny Kohli.
• Danvantri (Chennai, India), a team from technology manufacturer American Megatrends India and led by director and CEO Sridharan Mani.
• DMI (Cambridge, Mass.), a team led by Dr. Eugene Y. Chan of the DNA Medicine Institute partnering with NASA, the National Institutes of Health and the Bill and Melinda Gates Foundation.
• Dynamical Biomarkers Group (Zhongli City, Taiwan), a team of physicians, scientists and engineers led by Harvard Medical School Prof. Chung-Kang Peng.
• Final Frontier Medical Devices (Paoli, Pa.), a team led by the founders of Basil Leaf Technologies—brothers Dr. Basil Harris, an emergency room physician, and George Harris, a network engineer.
• MESI Simplifying diagnostics (Ljubljana, Slovenia), a team from diagnostic medical device manufacturer MESI and led by CEO, Jakob Susteric.
• SCANADU (Moffett Field, Calif.), a team from Silicon Valley-based startup SCANADU led by technology entrepreneur, and co-founder and CEO, Walter De Brouwer.
• SCANurse (London, England), a team from diagnostic medical manufacturer SCANurse and led by biomedical engineer and founder Anil Vaidya.​
• zensor (Belfast, Ireland), a team from clinical sensor and electrode company Intelesens and led by the chief technology officer, Prof. Jim McLaughlin.

Kohli, a critical-care physician, says the inspiration for the device stemmed from his experiences volunteering as a doctor in Haiti after the devastating earthquake in 2010.

"A Tricorder-type device [is] something that's mobile, something you can carry with you ... you can take to disaster relief zones or villages or your grandma's house," Kohli says in a video on the contest website. "It's shocking to me that is hasn't been done."

The company already has a device known as a Pulse Wave that goes around the wrist and is able to monitor vitals such as blood pressure, heart rate and various arrhythmias easily, constantly and painlessly. The Tricorder prototype that emerges could prove to be similar to that.

CloudDX made the final cut after a panel of judges reviewed their entry based on safety issues, user experience and a health assessment. Among 21 entries, CloudDX was deemed credible and worthy enough to move on.

Teams will now compete in both diagnostic experience evaluations and consumer testing for their prototypes, which is slated to happen late next year. The final judging and awards ceremony will take place in early 2016.

Up to three winners will ultimately share the $10 million.

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BMO profit flat at $1.1 billion

The Canadian Press Posted: Aug 26, 2014 9:03 AM ET Last Updated: Aug 26, 2014 9:04 AM ET

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Aug 26, 2014 11:15 AM ET Aug 26, 2014 11:15 AM ET Aug 26, 2014 11:15 AM ET Aug 26, 2014 11:20 AM ET Aug 26, 2014 11:15 AM ET

Index	Last Trade	Change
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Tim Hortons, Burger King agree to merger deal

Tim Hortons has agreed to be bought by the company that owns Burger King in a deal that could culminate in the world's third largest fast-food company. 

Burger King and Tim Hortons have a firm offer on the table to create the world's third largest fast-food restaurant chain. (Patrick Morrell/CBC)

The new combined company would be based at the current headquarters of Tim Hortons, in Oakville, Ont. Burger King would continue to maintain its global home in Miami. 

The deal is structured as follows:

• 3G Capital, the investment firm that owns Burger King, would pay $65.50 in cash for every Tim Hortons share already out there.
• In addition to that cash, every Tim Hortons shareholder would get 0.8025 shares in the new, as yet unnamed company.
• Shareholders also would have the right to choose an all-cash or all-stock option.

That would bring the cash value of the deal for current Tim Hortons owners to more than $94 per share. That's 39 per cent higher than the average price Tim Hortons shares have traded at during the month leading up to last weekend, when rumours of a deal emerged.

After gaining 20 per cent Monday, when the two companies confirmed they were in talks, Tim Hortons shares gained another 8 per cent on Tuesday following word of a concrete offer.

The new company would have combined global sales of $23 billion and have 18,000 locations in 98 countries.

"We see no reason we can't bring the double-double to the rest of the world," 3G's Alex Behring said on a conference call discussing the deal with analysts, adding no jobs will be affected at the restaurant level.

International expansion

Executives from the companies involved also poured cold water on theories that the move was an elaborate tax inversion chiefly designed to bring down Burger King's tax rate. Canada's basic corporate tax rate is about 26 per cent, while the U.S.'s is around 35 per cent.

But Burger King already managed to get its tax rate down to 27.5 per cent last year, company filings show. Tim Hortons paid 26.8 per cent tax in Canada last year, according the its annual report.

"We don't expect our tax rate to change materially" Burker King CEO Daniel Schwartz said on the call.

If the deal goes through as is, 3G would still control 51 per cent of the new company. Current Burger King shareholders would own 27 per cent, and current Tim Hortons shareholders would own the remaining 22 per cent.

The boards of both companies have unanimously approved the transaction. Two-thirds of Burger King is owned by 3G, so the deal has been consummated on that end, but Tim Hortons shareholders still have to approve it.

The deal is subject to numerous regulatory and anti-trust hurdles, including the Investment Canada Act. "The transaction ... is structured to bring significant benefits to Canada," Behring said, including the infamous "net benefit" test that has scuppered deals in the past.

Burger King exec will be new CEO

Shares in the new company will list both on the TSX and NYSE. 

Daniel Schwartz, CEO of Burger King, would also become CEO of the new company. Current Tim Hortons CEO Marc Caira would become a director of the new company, as well as its vice-chairman.

The new company's board would include the current eight Burger King directors and three Canadian directors to be appointed by Tim Hortons, including Caira. 

Warren Buffett's company Berkshire Hathaway is helping finance the deal with $3 billion of preferred equity financing, but will not have a role in managing operations.

A look at some of the numbers involved in the proposed burger and coffee tie-up. (Richard Grasley/CBC)

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Trade a hot topic ahead of premiers' meeting in Charlottetown

As premiers and territorial leaders gather in Prince Edward Island for their annual summer meeting this week, talk will turn again to barriers to trade that exist between provinces even as the country negotiates more free-trade deals abroad.

Saskatchewan Premier Brad Wall is leading the push for fewer internal trade barriers.

Wall lists trade irritants, such as the fact that companies outside Ontario face a 10 per cent premium if they want to bid on procurement in that province.

"What comes from these small protectionist measures is there's going to be a reaction. And we're going to have less trade and less free procurement. That just never works economically. It's been proven," he told CBC News this week.

Saskatchewan is also engaged in a trade battle with Quebec. Saskatchewan argues Quebec is blocking the import of dairy products blended with canola.

Saskatchewan won at the dispute resolution tribunal, but Quebec is appealing.

And Wall is frustrated.

"It just highlights that the current agreement on internal trade — it's not sufficient. We could do something much bolder. We can have a Canada free-trade zone. I think this makes common sense for Canadians everywhere."

This internal discussion comes just as the federal government released the details of its trade agreement with Europe.

It includes opening up local construction projects to European companies and allows the provinces to trade with Europe more easily.

Prince Edward Island Premier Robert Ghiz, who is chairing the meeting, says there's a lesson there for the provinces.

"Let's look at the trade agreements that we have with other countries. And if those trade agreements make it easier to trade with a different country, compared to another province, then we've got a problem," Ghiz said.

Ontario Premier Kathleen Wynne says she's open to the idea of a balance between lowering trade barriers while still protecting the interests of local industries.

She points to the difficult negotiations over Canada's dairy industry during the free-trade talks with Europe.

"It will be the same discussion between B.C. and Ontario, for example, on wine. How do we advance the overall cause so that the B.C. wine industry can thrive and Ontario's industry can thrive," said Wynne.

"I'm open to removing those barriers. But I also want to make sure that whatever we do is going to be in the interests of Ontario's wine industry."

Meanwhile, the premiers will be joined, informally, by the U.S. and Chinese ambassadors to Canada, as well as Canada's ambassadors to those two countries.

Wall thinks that's a great idea.

"I really do think it will shine a light on the importance of trade with our largest partner in the United States, and our fast-growing trade partner in China."

Wynne, too, is pleased, especially now that the provinces are holding another trade mission to China in October.

But, she adds, there is one person missing from the table: Prime Minister Stephen Harper.

"The fact that the federal government has refused, that Stephen Harper has refused to come and meet with the premiers, I think is a very big problem.

"It's a big problem in terms of international trade. It's a big problem in terms of internal trade. It's a problem in terms of national interest, like a Canadian energy strategy, or like infrastructure investment. It would be better if the federal government were at the table with us," Wynne said.

The federal industry minister did release a discussion paper last week that lists two options on internal trade.

One is to scrap the 20-year-old national trade agreement and negotiate a new one. The second is to amend the current deal.

Either way, James Moore wants the provinces to do more. "My preference is for us to all be more ambitious than we've been thus far," Moore told CBC Radio's The House.

But some provinces don't like Moore's suggestion they should do more, arguing Ottawa hasn't done much to improve internal trade, either.

"They need to lead by example. The provinces will have a lively discussion about it, and will come up with practical solutions," Manitoba Premier Greg Selinger told CBC News.

Besides trade, the premiers have a number of other issues on their agenda for the three-day Council of the Federation meeting, including a Canadian energy strategy, infrastructure investment and fiscal transfers from Ottawa.

They will begin with a meeting with aboriginal leaders on Wednesday, during which they are expected to renew their call for a national inquiry into missing and murdered aboriginal women.

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Scotiabank boosts dividend 2 cents on higher profit

Scotiabank profit increased to $2.35 billion in the quarter.

Scotiabank is boosting its shareholder dividend by two cents, while reporting a higher third-quarter net income of $2.35 billion.

The bank is boosting its dividend by two cents for the quarter ending Oct. 31.

Scotiabank says it earned $1.85 per diluted share in the quarter, up 35 per cent from $1.74 billion, or $1.36 per share, in the same period last year.

The bank says the net earnings include $555 million, or 45 cents per share, related to the sale of a majority of its investment in CI Financial Corp.

Excluding the sale and other one-time items, the bank's adjusted net income was $1.79 billion, up eight per cent from $1.65 billion on adjusted earnings per diluted share of $1.40. Analysts had expected adjusted earnings per share of $1.41.

Return on equity was 20.6 per cent, compared with 17.2 per cent at the same time last year. Revenues were $6.48 billion compared with $5.51 billion.

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Rogers, Shaw launch rival Netflix-like service Shomi

Rogers and Shaw have unveiedl their Shomi streaming service, pitching it as a rival to Netflix. (iStock)

A new subscription video-on-demand service with 11,000 hours of popular TV shows was unveiled today in Toronto by Rogers Communications and Shaw Communications.

Shomi is a joint venture of Rogers and Shaw, and will initially be available to their internet or TV customers.

Users will be able to access the service on tablet, mobile, online and through Xbox 360. At any one time, two internet-enabled devices and one set-top box can be streaming video from Shomi in a single home.

Shomi will launch in the first week of November at a suggested retail price of $8.99 per month, the same price as Netflix after its price rise announced earlier this year.

Shomi will offer 340 TV series and 1,200 movies, with 30 per cent Canadian content.

Shomi has past-season streaming rights to popular contemporary TV shows including:

• Modern Family
• Sons of Anarchy
• Sleepy Hollow
• Shameless
• 2 Broke Girls

"We keenly understand the media landscape is rapidly changing and that viewers are looking for greater flexibility when it comes to what they watch and how they watch it," Barbara Williams, senior vice-president for content at Shaw Media, said in a statement.

Although the company is a joint venture of Shaw and Rogers, it will operate as a stand-alone entity. With almost one third of anglophone Canadians already subscribing to Netflix, it will be a struggle for the service to attain a significant subscriber base. 

However, both companies need a strategy to build their businesses, as traditional cable sales are flat, with the big operators poaching each other's customers and more Canadians considering cutting the cord altogether.

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Inflation rate in Canada cools to 2.1% in July

Canada's inflation rate slowed to 2.1 per cent in July, slightly below the 2.4 per cent in the previous month.

Statistics Canada reported Friday that shelter and food were the biggest contributors to the annual increase in the consumer price index, although all eight components the agency tracks were higher.

The transportation sector was a weak point, however. After increasing by 5.4 per cent in June, the increase in pump prices slowed last month, to 2.1 per cent. But gasoline prices were offset by a jump in natural gas, which was 20 per cent more expensive this July than it was a year ago.

The costs of home and mortgage insurance also rose, along with property taxes. And the price of cigarettes increased by more than 10 per cent after a series of new taxes were implemented.

June's overall rate was the highest level in more than two years, but even after the pullback in July, Canada's inflation rate is still above the midpoint of the range policymakers like to see — between one and three per cent.

"This report is consistent with the view that inflation pressures observed earlier this year have started to moderate as some of the temporary upward influences reverse course," TD economist Randall Bartlett said of the data, in a note to clients Friday morning.

Regionally, consumer prices rose in every province. Ontario,Saskatchewan and Alberta posted the largest increases, while British Columbia recorded the smallest.

Saskatchewan and Alberta were the only provinces where prices rose at faster rates in July compared to June.

The inflation data came alongside a separate Statistics Canada release Friday that showed retail sales jumped by 1.1 per cent in June to $42.6 billion — the third straight monthly increase.

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