Notices of winning a prize
Section 53 of the Competition Act, prohibits the sending of a notice that gives the recipient the general impression he or she has won a prize or other benefit and asks or gives the option to pay money or incur a cost in order to obtain the prize or benefit. The provision applies to notices sent by any means, including but not limited to regular or electronic mail. No offence would arise if the recipient actually receives the prize or benefit and the person who sent the notice: (1) provides fair and adequate disclosure of the number and approximate value of prizes or benefits, the area or areas to which they have been allocated, and any fact that materially affects the chances of winning; (2) distributes prizes without unreasonable delay; and (3) selects participants or distributes prizes randomly or on the basis of participants’ skill, in any area to which the prizes or benefits have been allocated.
Additional information
Adequate and fair disclosure
In determining whether disclosure has been made in an adequate and fair manner under the saving provision of subparagraph 53(2)(a), the Bureau considers whether disclosure has been made in a reasonably conspicuous manner, at a time before the potential entrant is inconvenienced in some way, incurs some cost, or is committed to the advertiser's product or to the contest. Adequate and fair disclosure is evaluated in light of the actual and intended audiences of the contest.
The issue of adequate and fair disclosure is determined in relation to each of the following:
A Approximate value
The section requires the disclosure of the approximate value of the prizes or benefits. This normally means the approximate regular market value of the product. However, where the final value of a prize or benefit in a contest is dependent upon the location in Canada of the winner (for example, where the prize is a trip from the winner's residence to a foreign destination), the inclusion of a few representative examples or of the range of possible values of the prizes or benefits would meet the requirements of the section. Depending on the circumstances of each case, there may be other acceptable methods of disclosing the approximate value of the prizes or benefits.
B Regional allocation
For contests where prizes or benefits are allocated on a regional basis (for example, one prize for residents of the Atlantic provinces, one prize for residents of Quebec, etc.), and where the promotion for the contest takes place on an inter-regional basis, any regional allocation of prizes or benefits should be clearly disclosed.
C Chances of winning
Whenever the total number of any production run or population in which prizes or benefits are to be seeded or awarded is known, this matter would be a "fact within the person's knowledge that materially affects the chances of winning" and needs to be disclosed.
D Series of prizes or benefits
When a contest involves a series of prizes or other benefits to be awarded at different times, care should be taken to ensure that the promotional material does not imply that all of the prizes or benefits remain to be won when some have, in fact, already been awarded. For example, in a contest where a prize of $1,000 is to be awarded each month for a period of five months, advertisements for the contest should not continue to imply, after the first month of the contest, that there are still five $1,000 prizes to be awarded.
