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Is Your Advertising Campaign Misleading?

Is Your Advertising Campaign Misleading?

We live in a world full of advertisements. Our every day life is surrounded by advertisements. But are some of these advertisements misleading?

The Competition Act

The general provisions under this legislation can be both civil or criminal. that's right, you can be criminally penalized for having an advertising campaign that is misleading. What is considered misleading advertising? An advertisement that is accused of being misleading could gain this title if any marketing campaign has falsely promoted, supplied or sold a product or business.

What are the elements of a misleading advertisement?

The elements used to consider whether an advertisement is misleading includes:

  1. How was the advertisement presented? Was it posted online, or printed?

  2. Was the advertisement made public?

  3. Did the advertisement promote a product or business/business interest?

  4. Was the advertisement misleading or false? That being, the information being advertised was false.

  5. Is the material on the advertisement false? such as the pricing or performance claims.

What about advertisements that are comparative?

These types of comparative advertisements are permitted as long as the advertisement is not misleading or infringes another party's intellectual property rights. If you are going to use a third party trademark or copyright it is crucial that measures are taken to ensure compliance with Canada’s Trademarks Act.

Penalties

Civil

The potential penalties for violating the Competition Act provisions governing misleading advertisements may include a court proceeding with the Competition Tribunal, an order to publish a remedial notice, pay compensation to the affected party and/or administrative penalties of up to $750,000 for individuals and $10 million for corporations.

Criminal

For a misleading advertising claim to be considered criminal, it must be proven that the advertiser had intent to falsely advertise the product or service. Any claims that are said to be criminal offences have the potential penalty on indictment of imprisonment for up to 14 years, a fine in the discretion of the court, or both. On summary convictions the potential penalties are a fine of up to $200,000, imprisonment for up to 1 year, or both.


COVID-19 and Advertising

Recently, the Competition Bureau has taken strict measures on misleading advertisements especially those in relation to the current global pandemic; COVID-19. You may be in violation of the Competitions Act if your advertisement implies any of the following:

  1. Claims a certain performance of a product in relation to COVID-19.

  2. Claims that a certain treatment could be of assistance to people affected by the virus.

  3. Claims that certain measures may be a preventive method against the virus.

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Froese Law provides its Canadian law services by a professional corporation.  

Froese Law provides its U.S. legal services in affiliation with a U.S. based law firm.

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