Amendments to Competition Act Create Possibility of New Class Action for Deceptive Marketing

For decades, Federal Government has deliberately pursued a limited and measured approach to permitting private enforcement of Canada’s competition laws. Parliament has amended the Competition Act to permit private parties to seek leave from the Competition Bureau to pursue proceedings in respect of two additional types of anti-competitive conduct under the Competition Act — namely, civil deceptive marketing practices and civil anti-competitive agreements. These expanded rights of access will come into effect on June 20, 2025. 

In its recent amendments to the Competition Act, the Federal Government has opened the doors of the Competition Bureau to private litigants that seek to enforce the civil provisions of the Act. These amendments include: 

• the creation of new rights of private access to the Competition Bureau in respect of civil deceptive marketing practices  

• a liberalizing of the test for “leave” that a private party has to meet to commence an application before the Competition Bureau, potentially enabling public-interest organizations to pursue proceedings before the Competition Bureau 

• the creation of a new right for a private party to seek monetary relief from the Competition Bureau in respect of civil reviewable practices 

• the recognition of a right for a private party to seek monetary remedies on behalf of other “affected parties” and the apparent creation of a nascent class action regime that will be overseen by the Competition Bureau 

Under these amendments, a private party will be able seek leave from the Competition Bureau to challenge a deceptive marketing practice under section 74.1 of the Act. In particular, a private party can seek leave to pursue relief against an individual or company that has made false or misleading representations to the public in respect of the promotion of the supply or use of a product or the promotion of any business interest. And as a result of the parallel amendments in respect of the new greenwashing provisions of the Competition Act (see above), it will now be expressly open for a private litigant to seek leave to pursue a proceeding in respect of alleged misrepresentations relating to a product’s benefits in protecting the environment or in mitigating the effects of climate change. 

It is important to note that a private party that is seeking private access in respect of a deceptive marketing practice (section 74.1) may only seek leave on the basis of the public-interest test. 

This restriction is interesting : Parliament appears to have been alive to the risk of tactical litigation by a competitive rival that claims that it was harmed in its business as a result of marketing claims, but it nonetheless extended a right of access to rivals and organizations that were not harmed to seek private access on public-interest grounds.