It seems that a lot of time recently has been spent debating whether the price of products should be fully disclosed in advertising (and that many cases and regulatory announcements have turned on this apparently, but perhaps not so, simple question).
For example, last year in June, Bell Canada entered into a settlement (a consent agreement) with the Competition Bureau and agreed to stop making allegedly misleading claims relating to the prices for its services and pay an administrative monetary penalty of C $10 million. According to the Bureau, Bell charged higher prices than advertised for many of its services, including home phone, Internet, satellite TV and wireless (see: Bell Canada Agrees to Pay $10 Million Fine in Misleading Advertising Case).
Then late last year, the Conservative Government announced that airlines would be required to disclose the full price of airline fares by the end of 2012 (including airport taxes and additional charges), pursuant to (long-anticipated) regulations under the Canada Transportation Act (see: Federal Government to Introduce Advertising Regulations for Airlines).
The Commissioner of Competition has also recently underscored the Bureau’s intent to continue its aggressive enforcement of misleading and deceptive advertising, including false price-related claims. For example, in one recent speech the Commissioner said: “[m]oving then to talk about our Fair Business work, misleading representations continue to be an area of concern for the Bureau, as consumers need accurate information in order to make informed choices. It’s very simple — don’t mislead the public by hiding charges or conditions in fine print, or by making claims you can’t back up” (see: Commissioner of Competition Speech Highlights Enhanced Competition Bureau Enforcement).
Competition counsel in Canada have also recently noted a marked change in the regulatory landscape making fuller disclosure of price (or perhaps more accurately the complete price) more important for companies doing business in Canada (see e.g., Is the Price Right? Increased Regulatory Scrutiny and Class Actions for Representations Involving Price).
Most recently, earlier today, the Financial Post reported that Air Canada and Porter Airlines announced that they would begin advertising the “all-in-price” of fares this week ahead of the new federal Canada Transportation Act regulations (see: Air Canada, Porter to advertise all-in-price for airfares).
Specific Canada Transportation Act regulations aside, the risk of failing to disclose material elements of the price of a product is nothing new.
The general misleading advertising provisions of the Competition Act do, and have always, prohibited materially false advertising claims, which can also include the failure to disclose information that may be considered to be material to consumers (i.e., cause an average consumer to make a purchasing decision or otherwise alter his or her conduct), such as information relating to price, performance or other key aspects of a product that consumers are interested in (see: Misleading Advertising).
What clearly has changed, however, is that regulators appear significantly more intent in the past several years to ensure that companies disclose the price, the complete price and nothing but the complete price of their products. Whether this will in fact result in tangible changes in the way companies market remains to be seen.
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