The argument Piragoff was making in front of the Senate Justice committee, is that the sellers deriving benefits from providing their own services are immune to prosecution; they're still criminals however.
According to Piragoff, the conjunction of:
286.2 (1) Everyone who receives a financial or other material benefit, knowing that it is obtained by or derived directly or indirectly from the commission of an offence under subsection 286.1(1), is guilty of an indictable offence and liable to imprisonment for a term of not more than 10 years
and
286.5 (1) No person shall be prosecuted for
(a) an offence under section 286.2 if the benefit is derived from the provision of their own sexual services; or
http://www.parl.gc.ca/HousePublications/Publication.aspx?Pub=Bill&Doc=C-36&File=4
should not be interpreted as meaning that someone selling their own sexual services, is not a criminal.