The
Competition Act provides criminal and civil regimes to address false or misleading representations.
Section 52 of the Act is a criminal provision. It prohibits knowingly or recklessly making, or permitting the making of, a representation to the public, in any form whatever, that is false or misleading in a material respect. Under this provision, it is not necessary to demonstrate that any person was deceived or misled; that any member of the public to whom the representation was made was within Canada; or that the representation was made in a place to which the public had access. Subsection 52(4) directs that the
general impression conveyed by a representation, as well as its literal meaning, be taken into account when determining whether or not the representation is false or misleading in a material respect.
Any person who contravenes section 52 is guilty of an offence and liable to a fine of up to $200,000 and/or imprisonment up to one year on summary conviction, or to fines in the discretion of the court and/or imprisonment up to 14 years upon indictment.
Paragraph 74.01(1)(a) of the Act is a civil provision. It prohibits the making, or the permitting of the making, of a representation to the public, in any form whatever, that is false or misleading in a material respect. Under this provision, it is not necessary to demonstrate that any person was deceived or misled; that any member of the public to whom the representation was made was within Canada; or that the representation was made in a place to which the public had access. Subsection 74.03(5) directs that the
general impression conveyed by a representation, as well as its literal meaning, be taken into account when determining whether or not the representation is false or misleading in a material respect.
If a court determines that a person has engaged in conduct contrary to paragraph 74.01(1)
(a), it may order the person not to engage in such conduct, to publish a corrective notice, to pay an administrative monetary penalty and/or to pay restitution to purchasers. When the court orders the payment of administrative monetary penalties, on first occurrence, individuals are subject to penalties of up to $750,000 and corporations, to penalties of up to $10,000,000. For subsequent orders, the penalties increase to a maximum of $1,000,000 in the case of an individual and $15,000,000 in the case of a corporation. The court also has the power to order interim injunctions to freeze assets in certain cases.
Additional information on Restitution Orders and Interim Injunctions to Freeze Assets
In order to proceed on a criminal track both of the following criteria must be satisfied: (1) there must be clear and compelling evidence suggesting that the accused knowingly or recklessly made a false or misleading representation to the public. An example of such evidence is the continuation of a practice by the accused after complaints have been made by consumers directly to the accused; and (2) the Bureau must also be satisfied that criminal prosecution would be in the public interest. More information on the choice of track is available from the following publication
Misleading Representations and Deceptive Marketing Practices: Choice of Criminal or Civil Track Under the Competition Act.
roof of certain matters not required
