Competition Act (R.S.C., 1985, c. C-34)

Marginal note:False or misleading representation — sender or subject matter information

• 52.01 (1) No person shall, for the purpose of promoting, directly or indirectly, any business interest or the supply or use of a product, knowingly or recklessly send or cause to be sent a false or misleading representation in the sender information or subject matter information of an electronic message.

• Marginal note:False or misleading representation — electronic message

  (2) No person shall, for the purpose of promoting, directly or indirectly, any business interest or the supply or use of a product, knowingly or recklessly send or cause to be sent in an electronic message a representation that is false or misleading in a material respect.

• Marginal note:False or misleading representation — locator

  (3) No person shall, for the purpose of promoting, directly or indirectly, any business interest or the supply or use of a product, knowingly or recklessly make or cause to be made a false or misleading representation in a locator.

• Marginal note:Proof of deception not required

  (4) For greater certainty, in establishing that any of subsections (1) to (3) was contravened, it is not necessary to prove that any person was deceived or misled.

• Marginal note:Drip pricing

  (4.1) For greater certainty, the making of a representation of a price that is not attainable due to fixed obligatory charges or fees constitutes a false or misleading representation, unless the obligatory charges or fees represent only an amount imposed on a purchaser of the product referred to in subsections (1) to (3) by or under an Act of Parliament or the legislature of a province.

• Marginal note:General impression to be considered

  (5) In a prosecution for a contravention of any of subsections (1) to (3), the general impression conveyed by a representation as well as its literal meaning are to be taken into account.

• Marginal note:Offence and punishment

  (6) Any person who contravenes any of subsections (1) to (3) is guilty of an offence and

  • (a) liable on conviction on indictment to a fine in the discretion of the court or to imprisonment for a term not exceeding 14 years, or to both; or

  • (b) liable on summary conviction to a fine not exceeding $200,000 or to imprisonment for a term not exceeding one year, or to both.

• Marginal note:Reviewable conduct

  (7) Nothing in Part VII.1 is to be read as excluding the application of this section to the making of a representation that constitutes reviewable conduct within the meaning of that Part.

• Marginal note:Application made under Part VII.1

  (8) No proceedings may be commenced under this section against a person on the basis of facts that are the same or substantially the same as the facts on the basis of which an order against that person is, on application by the Commissioner, sought under Part VII.1.

• Marginal note:Interpretation

  (9) For the purposes of this section,

  • (a) an electronic message is considered to have been sent once its transmission has been initiated; and

  • (b) it is immaterial whether the electronic address to which an electronic message is sent exists or whether an electronic message reaches its intended destination.

Marginal note:Assisting foreign states

• 52.02 (1) The Commissioner may, for the purpose of assisting an investigation or proceeding in respect of the laws of a foreign state, an international organization of states or an international organization established by the governments of states that address conduct that is substantially similar to conduct prohibited under section 52, 52.01, 52.1, 53, 55 or 55.1,

  • (a) conduct any investigation that the Commissioner considers necessary to collect relevant information, using any powers that the Commissioner may use under this Act or the Criminal Code to investigate an offence under any of those sections; and

  • (b) disclose the information to the government of the foreign state or to the international organization, or to any institution of any such government or organization responsible for conducting investigations or initiating proceedings in respect of the laws in respect of which the assistance is being provided, if the government, organization or institution declares in writing that

    • (i) the use of the information will be restricted to purposes relevant to the investigation or proceeding, and

    • (ii) the information will be treated in a confidential manner and, except for the purposes mentioned in subparagraph (i), will not be further disclosed without the Commissioner’s express consent.

• Marginal note:Mutual assistance

  (2) In deciding whether to provide assistance under subsection (1), the Commissioner shall consider whether the government, organization or institution agrees to provide assistance for investigations or proceedings in respect of any of the sections mentioned in subsection (1).

Marginal note:Definition of telemarketing

• 52.1 (1) In this section, telemarketing means the practice of communicating orally by any means of telecommunication for the purpose of promoting, directly or indirectly, any business interest or the supply or use of a product.

• Marginal note:Required disclosures

  (2) No person shall engage in telemarketing unless

  • (a) disclosure is made, in a fair and reasonable manner at the beginning of each communication, of the identity of the person on behalf of whom the communication is made, the nature of the business interest or product being promoted and the purposes of the communication;

  • (b) disclosure is made, in a fair, reasonable and timely manner, of the price of any product whose supply or use is being promoted and any material restrictions, terms or conditions applicable to its delivery; and

  • (c) disclosure is made, in a fair, reasonable and timely manner, of such other information in relation to the product as may be prescribed by the regulations.

• Marginal note:Deceptive telemarketing

  (3) No person who engages in telemarketing shall

  • (a) make a representation that is false or misleading in a material respect;

  • (b) conduct or purport to conduct a contest, lottery or game of chance, skill or mixed chance and skill, where

    • (i) the delivery of a prize or other benefit to a participant in the contest, lottery or game is, or is represented to be, conditional on the prior payment of any amount by the participant, or

    • (ii) adequate and fair disclosure is not made of the number and approximate value of the prizes, of the area or areas to which they relate and of any fact within the person’s knowledge, that affects materially the chances of winning;

  • (c) offer a product at no cost, or at a price less than the fair market value of the product, in consideration of the supply or use of another product, unless fair, reasonable and timely disclosure is made of the fair market value of the first product and of any restrictions, terms or conditions applicable to its supply to the purchaser; or

  • (d) offer a product for sale at a price grossly in excess of its fair market value, where delivery of the product is, or is represented to be, conditional on prior payment by the purchaser.

• Marginal note:General impression to be considered

  (4) In a prosecution for a contravention of paragraph (3)(a), the general impression conveyed by a representation as well as its literal meaning shall be taken into account in determining whether or not the representation is false or misleading in a material respect.

• Marginal note:Time of disclosure

  (5) The disclosure of information referred to in paragraph (2)(b) or (c) or (3)(b) or (c) must be made during the course of a communication unless it is established by the accused that the information was disclosed within a reasonable time before the communication, by any means, and the information was not requested during the communication.

• Marginal note:Due diligence

  (6) No person shall be convicted of an offence under this section who establishes that the person exercised due diligence to prevent the commission of the offence.

• Marginal note:Offences by employees or agents

  (7) Notwithstanding subsection (6), in the prosecution of a corporation for an offence under this section, it is sufficient proof of the offence to establish that it was committed by an employee or agent of the corporation, whether or not the employee or agent is identified, unless the corporation establishes that the corporation exercised due diligence to prevent the commission of the offence.

• Marginal note:Liability of officers and directors

  (8) Where a corporation commits an offence under this section, any officer or director of the corporation who is in a position to direct or influence the policies of the corporation in respect of conduct prohibited by this section is a party to and guilty of the offence and is liable to the punishment provided for the offence, whether or not the corporation has been prosecuted or convicted, unless the officer or director establishes that the officer or director exercised due diligence to prevent the commission of the offence.

• Marginal note:Offence and punishment

  (9) Any person who contravenes subsection (2) or (3) is guilty of an offence and liable

  • (a) on conviction on indictment, to a fine in the discretion of the court or to imprisonment for a term not exceeding 14 years, or to both; or

  • (b) on summary conviction, to a fine not exceeding $200,000 or to imprisonment for a term not exceeding one year, or to both.

• Marginal note:Sentencing

  (10) In sentencing a person convicted of an offence under this section, the court shall consider, among other factors, the following aggravating factors:

  • (a) the use of lists of persons previously deceived by means of telemarketing;

  • (b) characteristics of the persons to whom the telemarketing was directed, including classes of persons who are especially vulnerable to abusive tactics;

  • (c) the amount of the proceeds realized by the person from the telemarketing;

  • (d) previous convictions of the person under this section or under section 52 in respect of conduct prohibited by this section; and

  • (e) the manner in which information is conveyed, including the use of abusive tactics.

Marginal note:Deceptive notice of winning a prize

• 53 (1) No person shall, for the purpose of promoting, directly or indirectly, any business interest or the supply or use of a product, send or cause to be sent by electronic or regular mail or by any other means a document or notice in any form, if the document or notice gives the general impression that the recipient has won, will win, or will on doing a particular act win, a prize or other benefit, and if the recipient is asked or given the option to pay money, incur a cost or do anything that will incur a cost.

• Marginal note:Non-application

  (2) Subsection (1) does not apply if the recipient actually wins the prize or other benefit and the person who sends or causes the notice or document to be sent

  • (a) makes adequate and fair disclosure of the number and approximate value of the prizes or benefits, of the area or areas to which they have been allocated and of any fact within the person’s knowledge that materially affects the chances of winning;

  • (b) distributes the prizes or benefits without unreasonable delay; and

  • (c) selects participants or distributes the prizes or benefits randomly, or on the basis of the participants’ skill, in any area to which the prizes or benefits have been allocated.

• Marginal note:Due diligence

  (3) No person shall be convicted of an offence under this section who establishes that the person exercised due diligence to prevent the commission of the offence.

• Marginal note:Offences by employees or agents

  (4) In the prosecution of a corporation for an offence under this section, it is sufficient proof of the offence to establish that it was committed by an employee or agent of the corporation, whether or not the employee or agent is identified, unless the corporation establishes that the corporation exercised due diligence to prevent the commission of the offence.

• Marginal note:Liability of officers and directors

  (5) Where a corporation commits an offence under this section, any officer or director of the corporation who is in a position to direct or influence the policies of the corporation in respect of conduct prohibited by this section is a party to and guilty of the offence and is liable to the punishment provided for the offence, whether or not the corporation has been prosecuted or convicted, unless the officer or director establishes that the officer or director exercised due diligence to prevent the commission of the offence.

• Marginal note:Offence and punishment

  (6) Any person who contravenes this section is guilty of an offence and liable

  • (a) on conviction on indictment, to a fine in the discretion of the court or to imprisonment for a term not exceeding 14 years, or to both; or

  • (b) on summary conviction, to a fine not exceeding $200,000 or to imprisonment for a term not exceeding one year, or to both.

• Marginal note:Sentencing

  (7) In sentencing a person convicted of an offence under this section, the court shall consider, among other factors, the following aggravating factors:

  • (a) the use of lists of persons previously deceived by the commission of an offence under section 52.1 or this section;

  • (b) the particular vulnerability of recipients of the notices or documents referred to in subsection (1) to abusive tactics;

  • (c) the amount of the proceeds realized by the person from the commission of an offence under this section;

  • (d) previous convictions of the person under section 52 or 52.1 or this section; and

  • (e) the manner in which information is conveyed, including the use of abusive tactics.

Marginal note:Double ticketing

• 54 (1) No person shall supply a product at a price that exceeds the lowest of two or more prices clearly expressed by him or on his behalf, in respect of the product in the quantity in which it is so supplied and at the time at which it is so supplied,

  • (a) on the product, its wrapper or container;

  • (b) on anything attached to, inserted in or accompanying the product, its wrapper or container or anything on which the product is mounted for display or sale; or

  • (c) on an in-store or other point-of-purchase display or advertisement.

• Marginal note:Offence and punishment

  (2) Any person who contravenes subsection (1) is guilty of an offence and liable on summary conviction to a fine not exceeding ten thousand dollars or to imprisonment for a term not exceeding one year or to both.

Marginal note:Definition of multi-level marketing plan

• 55 (1) For the purposes of this section and section 55.1, multi-level marketing plan means a plan for the supply of a product whereby a participant in the plan receives compensation for the supply of the product to another participant in the plan who, in turn, receives compensation for the supply of the same or another product to other participants in the plan.

• Marginal note:Representations as to compensation

  (2) No person who operates or participates in a multi-level marketing plan shall make any representations relating to compensation under the plan to a prospective participant in the plan unless the representations constitute or include fair, reasonable and timely disclosure of the information within the knowledge of the person making the representations relating to

  • (a) compensation actually received by typical participants in the plan; or

  • (b) compensation likely to be received by typical participants in the plan, having regard to any relevant considerations, including

    • (i) the nature of the product, including its price and availability,

    • (ii) the nature of the relevant market for the product,

    • (iii) the nature of the plan and similar plans, and

    • (iv) whether the person who operates the plan is a corporation, partnership, sole proprietorship or other form of business organization.

• Marginal note:Idem

  (2.1) A person who operates a multi-level marketing plan shall ensure that any representations relating to compensation under the plan that are made to a prospective participant in the plan by a participant in the plan or by a representative of the person who operates the plan constitute or include fair, reasonable and timely disclosure of the information within the knowledge of the person who operates the plan relating to

  • (a) compensation actually received by typical participants in the plan; or

  • (b) compensation likely to be received by typical participants in the plan, having regard to any relevant considerations, including those specified in paragraph (2)(b).

• Marginal note:Due diligence defence

  (2.2) A person accused of an offence under subsection (2.1) shall not be convicted of the offence if the accused establishes that he or she took reasonable precautions and exercised due diligence to ensure

  • (a) that no representations relating to compensation under the plan were made by participants in the plan or by representatives of the accused; or

  • (b) that any representations relating to compensation under the plan that were made by participants in the plan or by representatives of the accused constituted or included fair, reasonable and timely disclosure of the information referred to in that subsection.

• Marginal note:Offence and punishment

  (3) Any person who contravenes subsection (2) or (2.1) is guilty of an offence and liable

  • (a) on conviction on indictment, to a fine in the discretion of the court or to imprisonment for a term not exceeding five years or to both; or

  • (b) on summary conviction, to a fine not exceeding $200,000 or to imprisonment for a term not exceeding one year, or to both.