Please use the following form to notify the Competition Bureau if you believe that a company or an individual has contravened the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act, or the Precious Metals Marking Act. Show
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False or misleading representations and deceptive marketing practices under the Competition ActThe Competition Act contains provisions addressing false or misleading representations and deceptive marketing practices in promoting the supply or use of a product or any business interest. All representations, in any form whatever, that are false or misleading in a material respect are subject to the Act. If a representation could influence a consumer to buy or use the product or service advertised, it is material. To determine whether a representation is false or misleading, the courts consider the "general impression" it conveys, as well as its literal meaning. The Act provides two adjudicative regimes to address false or misleading representations and deceptive marketing practices. Under the criminal regime, the general provision prohibits all materially false or misleading representations made knowingly or recklessly. Other provisions specifically forbid deceptive telemarketing, deceptive notices of winning a prize, double ticketing, and schemes of pyramid selling. The multi‑level marketing provisions prohibit certain types of representations relating to compensation. Under the civil regime, the general provision prohibits all materially false or misleading representations. Other provisions specifically prohibit performance representations that are not based on adequate and proper tests, misleading warranties and guarantees, false or misleading ordinary selling price representations, untrue, misleading or unauthorized use of tests and testimonials, bait and switch selling, and the sale of a product above its advertised price. The promotional contest provisions prohibit contests that do not disclose required information. False or misleading representations and deceptive marketing practices can have serious economic consequences, especially when directed toward large audiences or when they take place over a long period of time. They can affect both business competitors who are engaging in honest promotional efforts, and consumers. What are the possible penalties?Under the criminal regime, certain practices are brought before the criminal courts, requiring proof of each element of the offence beyond a reasonable doubt. On summary conviction, the person is liable to a fine of up to $200,000 and/or imprisonment for up to one year. If convicted on indictment, the person is liable to a fine at the discretion of the court and/or imprisonment for up to 14 years. Under the civil regime, certain practices may be brought before the Competition Tribunal, the Federal Court or the superior court of a province and require that each element of the conduct be proven on a balance of probabilities. The court may order a person to cease the activity, publish a notice and/or pay an administrative monetary penalty. On first occurrence, individuals are liable to penalties of up to $750,000 and corporations are liable to penalties of up to $10,000,000. For subsequent occurrences, the penalties increase to a maximum of $1,000,000 for individuals and $15,000,000 for corporations. In situations where a person has made materially false or misleading representations about a product to the public, the court may also make an order for restitution, requiring the person to compensate consumers who bought such products, and an interim injunction to freeze assets in certain cases. The Bureau conducts its investigations in private and keeps confidential the identity of the source and the information provided. However, if someone has important evidence about a contravention under the Act, that person may be asked to testify in court. Advertising Dos and Don'tsThe following "Dos and Don'ts" will help businesses comply with the Competition Act. Dos
Don'ts
The Competition Bureau is an independent law enforcement agency that contributes to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice. Headed by the Commissioner of Competition, the Bureau is responsible for the administration and enforcement of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act. For more information: www.competitionbureau.gc.ca Toll‑free: 1‑800‑348‑5358 Competition Bureau 50 Victoria Street Gatineau, Quebec K1A 0C9 Date modified: 2022-01-20 How might a business be in violation of a truth in advertising law?Truth in Advertising Laws also prohibit misleading or deceptive ads. So, if a store did have that product at the advertised price, but they knowingly only had one left without mentioning that, the ad would still be breaking the law. Ads also cannot be deceptive in any way.
Does the government have control over advertising?Established by the Federal Trade Commission Act (1914), the Federal Trade Commission (FTC) regulates advertising, marketing, and consumer credit practices and also prevents antitrust agreements and other unfair practices.
What is a misleading advertisement and how is regulated?Regulation by SEBI
An issue advertisement shall be considered to be misleading, if it contains: • Any statement made about the performance or activities of the company in the absence of necessary explanatory or qualifying statements, which may give an exaggerated , picture of the performance or activities. •
What are the rules of an advertisements?Under the watchful eye of the FTC, the following general advertising rules must be followed: Ads must be truthful and non-deceptive. Businesses must have evidence to back up their claims. Ads can't be unfair, meaning the advertisement can't cause substantial injury to consumers that consumers can't reasonably avoid.
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