Competition Act - Misleading Advertising and Deceptive Marketing Practices

To Whom Does This Apply?

Summary

What is the Competition Act?

The Competition Act is a federal law governing most business conduct in Canada. It contains both criminal and civil provisions aimed at preventing anti-competitive practices in the marketplace.

Misleading Representations and Deceptive Marketing Practices Provisions of the Competition Act

The 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 Competition Act specifically prohibits deceptive telemarketing, deceptive prize notices and schemes of pyramid selling, and sets out the responsibilities for operators and participants in multi-level marketing plans. Also addressed are deceptive marketing practices including, but not limited to:  

• advertising at a bargain price a product that is not available in reasonable quantities;
• selling a product at a price above the advertised price; and
• conducting a contest, lottery, or game of chance or skill, without making adequate and fair disclosure of facts that materially affect the chances of winning.

For a copy of the pamphlet Misleading Representations and Deceptive Marketing Practices  and the Information Bulletin on the Application of the Competition Act to Representations on the Internet visit the Web site.

DISCLAIMER
Information contained in this section is of a general nature only and is not intended to constitute advice for any specific fact situation. For particular questions, the users are invited to contact their lawyer. For additional information, see contact(s) listed below.

Ontario Contact(s):
See National Contact.