Archive for the 'Advertising' Category
On August 7, 2012, hearings in the landmark Canadian misleading advertising case Commissioner of Competition v. Rogers Communications Inc. began.
The case, the first constitutional test of increased “administrative monetary penalties” or “AMPs” under the Competition Act (the “Act”) for misleading advertising, promises to be a bit of a battle between the Competition Bureau (the “Bureau”) and Rogers in relation to a few key aspects of Canadian advertising law.
The case relates to certain performance claims made by Rogers in connection with its new cell phone brand Chatr, the effectiveness of disclaimers (like other recent high-profile Canadian advertising cases) and, perhaps the issue most likely to capture public attention, whether the potentially significant civil penalties now possible for misleading advertising are constitutional.
The Bureau is principally taking aim at two claims made by Rogers: that its (at the time) new Chatr cell phone brand had “fewer dropped calls than new wireless carriers” and that customers had “no worries about dropped calls”. According to the Bureau these claims, made to compete with new wireless entrants Mobilicity, Public Mobile and Wind Mobile, were either literally false in some cases (in markets where new entrant cell phone companies’ dropped call rates were superior to Rogers) or, where true, misleading (by conveying the general impression of appreciably lower dropped call rates, when any differences were in reality “imperceptible” to consumers).
The Bureau has also taken the position that certain disclaimers used by Rogers were ineffective in altering the general impression of its performance claims, including the view that some technical statements made by Rogers in disclaimers would be meaningless to the average consumer. For example, some Rogers disclaimers included statements such as: “Based on: cell site density; quality of indoor and underground reception; and seamless call transition when moving out of zone”.
I am pleased to be participating in the Canadian Bar Association’s upcoming CBA Canadian Legal Conference in Vancouver on a panel on August 13th, part of which is still to be announced, discussing recent competition law developments for in-house counsel:
“Canada’s competition and foreign investment laws are being enforced more vigorously than ever. The Competition Bureau has wide powers allowing them to investigate conduct that might have an anti-competitive impact on the Canadian marketplace, and investigations often involve high-stakes consequences for companies including public stigma, criminal penalties, or unneeded complications arising in the middle of a strategic merger. Learn how to minimize your risk and limit liability with practical guidance from our experienced panel on how to ensure regulatory approval for mergers, strategic alliances and joint ventures. (90 min)”
For more information about the CBA’s conference or this panel see:
____________________
For more information about our regulatory law services: Contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
Conventional wisdom is that the Competition Bureau will pursue most misleading advertising cases civilly, under section 74.01 of the Competition Act, not criminally (the Act also contains a criminal misleading advertising provision, section 52, as well as a number of other criminal deceptive marketing offences).
For example, in the Bureau’s 1999 Bulletin on the choice of the criminal or civil track for misleading advertising, which remains its leading statement on the question, the Bureau states that the civil track will be pursued in most instances (though it may proceed criminally where there is both clear evidence of intent – for example, continuing conduct after complaints are made – and a criminal prosecution is in the public interest).
Despite this expressed restraint to proceed criminally, there have been a steady stream of deceptive advertising and marketing cases over the past few years where the Bureau has commenced criminal enforcement proceedings. Some recent cases have involved deceptive telemarketing (see: here, here and here), employment opportunity schemes (see: here and here), a GST refund fraud scheme (see: here) and the sale of counterfeit cancer drugs on the Internet (see: here). In terms of criminal misleading advertising cases, the Bureau has appeared to be most concerned with deceptive telemarketing and fraudulent business directory schemes (although its efforts have not been restricted to those two categories of cases).
While imprisonment is rather rare in Canada for competition law offences, several individuals in these cases were also sentenced to imprisonment, ranging from conditional sentences in the community to 3 years, in addition to paying monetary penalties.
Paul Rubin has published an interesting paper on the “Regulation of Information and Advertising” in Competition Policy International.
Abstract:
“Deception is the manipulation of information to gain some advantage. This paper considers commercial deception through advertising. The paper first discusses the economics of information. The literature has derived four major policy conclusions. First, truthful information regarding price should not be restricted by regulatory authorities. Second, deception is most likely and most harmful for credence goods, and regulation is most useful (if it is useful at all) for these goods. Third, truthful information should never be restricted. Fourth, regulation of advertising is best done by authorities that specialize in advertising, rather than by agencies with another mission. A fifth, more tentative, conclusion is that regulation should limit itself to statements that are actually false, and ignore those that are misleading or deceptive. The paper begins with a discussion of the First Amendment issues in regulating advertising. It then considers advertising of prices and regulation and types of goods. The next section examines regulation of true information about characteristics of goods other than price, with special reference to the U.S. Food and Drug Administration. The paper also discusses measures of deception and policies of mandating disclosure of negative information and remedies.”
A few interesting competition, advertising and regulatory law developments caught my eye today including:
The Competition Bureau published its May Report of Concluded Merger Reviews including Glencore/Viterra (3 advance ruling certificates and 16 no action letters): Monthly Report of Concluded Merger Reviews – May.
The ABA, Antitrust Section has launched new e-book: Handbook of U.S. Antitrust Sources: ABA – Handbook of U.S. Antitrust Sources.
Canadian Lawyer Magazine published a rather good article on corporate anti-corruption policies (which caught my eye given our work in the competition law compliance program area): Why Boards Need to Pay More Attention to Anti-Corruption Policies.
The CBA is offering an advertising law compliance seminar on June 19th entitled “Truth in Advertising 101: Tips for In-House Counsel”. For registration information see: Truth in Advertising 101: Tips for In-House Counsel.
The Canadian Real Estate Association, together with its U.S. counterpart the National Association of REALTORS, are making a play for the Top Level Domain (TLD) .REALTOR for their members: The Canadian Real Estate Association Partners with the National Association of REALTORS in its Application for .REALTOR Top Level Domain Extension.
The Globe has reported on a Wal-Mart review of the world’s greatest corruption risk jurisdictions (Brazil, China, India, South Africa and Mexico): Wal-Mart Bribery Review Flags Brazil and China as Corruption Risks.
The British Columbia Real Estate Association (BCREA) published its May 2012 Connections newsletter (featuring advocacy news and BCREA’s government relations activities) with updates on disclosure and remediation for properties used in drug operations, new legislation to help solve strata disputes and information for REALTORS for the move back to the PST: BCREA – Connections – May 2012.
Constantine Cannon has written an interesting note on the recent National Football League Players Association collusion claim against the NFL, its clubs and team owners alleging a concerted arrangement for a $123 million per-Club salary cap for the 2010 season: Players Charge NFL Imposed Collusive Salary Cap.
The 1709 Blog posted an interesting update on French publishers’ settlement with Google in the Google Book Search Project case: Some French Fresh Air to the Google Books Project.
____________________
For more information about our regulatory law services contact: contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
Tatiana Chabeaux-Smith
(Consumer Protection BC – reprinted with permission)
We have all had that knock at the door. You are usually just sitting down to dinner or are up to your elbows in dish water. You answer the door to find someone “just happens to be in the area” and has extra material for paving your driveway, has a ladder handy to wash your windows, or has a vacuum that you just have to hear about. We often feel hesitation around starting a conversation with a door-to-door sales person but we do it anyway because we want to be polite. And then we don’t know how to end the conversation.
Don’t get us wrong, there are many legitimate businesses that use door-to-door sales as a marketing approach and who won’t pressure you into buying. But as a consumer, it’s hard to know how to say no or how to recognize potential scams.
If someone comes to your door selling you a product or service, try to remember that you did not invite them – they approached you. You are not obligated to enter into a contract with them nor are you required to spend your valuable time listening to a high-pressure sales tactic.
Here are some tips to help you if you find yourself in a door-to-door sales situation:
1. Ask for credentials and including ID and proof of who they are working for.
2. Ask for time to think about the offer. It’s always a good idea to think things over to see if you really need the product or service.
CANADIAN CONTEST RULES/PRECEDENTS
Do you need contest rules/precedents
for a Canadian contest?
We offer many types of Canadian contest/sweepstakes law precedents and forms (i.e., Canadian contest/sweepstakes law precedents to run common types of contests in Canada). These include precedents for random draw contests (i.e., where winners are chosen by random draw), skill contests (e.g., essay, photo or other types of contests where entrants submit content that is judged to enter the contest or for additional entries), trip contests and more. Also available are individual Canadian contest/sweepstakes precedents, including short rules (“mini-rules”), long rules, winner releases and a Canadian contest law checklist. For more information or to order, see: Canadian Contest Law Forms/Precedents. If you would like to discuss legal advice in relation to your contest or other promotion, contact us: Contact.
********************
Promotional contests in Canada are largely governed by the Competition Act, the Criminal Code, privacy legislation and the common law of contract. In addition, Quebec has a separate regulatory regime governing contests and contest authority (the Régie des alcools, des courses et des jeux). Canadian federal anti-spam law (CASL) also commonly applies to contests run in Canada (see below).
A few interesting regulatory law developments caught my eye today including:
Stanford University Press has published a new book entitled The Global Limits of Competition Law, edited by Daniel Sokol and Ioannis Lianos: Stanford University Press – The Global Limits of Competition Law.
The American Antitrust Institute has published a new global handbook on private competition law enforcement entitled The International Handbook on Private Enforcement of Competition Law: Edward Elgar Publishing – The International Handbook on Private Enforcement of Competition Law.
The Federal Government has introduced a new Safe Food for Canadians Act: Harper Government Introduces Safe Food for Canadians Act.
The Federal Privacy Commissioner yesterday issued a new policy position on online behavioural advertising: Policy Position on Online Behavioural Advertising.
The New York Times published an interesting Barnes & Noble Op Ed arguing that the settlement with e-book publishers would “punish consumers”: Barnes & Noble Argues Book Settlement “Punishes Consumers”.
The Australian competition regulator (the ACCC) has approved the Glencore/Viterra transaction: Australia Competition Watchdog Approves Glencore Takeover of Viterra.
____________________
For more information about our regulatory law services contact: contact
For more regulatory law updates follow us on Twitter: @CanadaAttorney
Templates/precedents and checklists to run promotional contests in Canada
Templates/precedents and checklists to comply with Canadian anti-spam law (CASL)
