According to the Chartered Professional Accountants of Canada (CPA Canada) statistics show that 46% of Canadians have been the victim of fraud at some point in their lives. Consumer complaints, beyond fraud, are common in Canada which has led governments at all levels to take steps to proactively protect Canadians. Consumer protection law is governed under provincial and territorial jurisdiction, as well as agencies set-up by government and some non-government organizations. As a result, it can be difficult to understand what obligations a business may have to consumers. Most jurisdictions have similar guidelines which businesses are required to follow in order to ensure they are protecting the rights of consumers and meeting their legal and regulatory obligations.
Regardless of the jurisdictions, most legislation covers the core elements of consumer protection. For a business, the following are general guidelines to ensure they meet their obligations under most legislation within Canada:
Businesses which engage in unscrupulous practices or refuse to follow consumer protection guidelines, can be subject to serious fines, injunctions, loss of licences, and related legal consequences. It should be noted that government agencies can use their enforcement powers to aggressively target non-compliant organizations.
Protecting consumers within Canada begins with federal legislation that is developed to promote consumer awareness and consumer protection. There are several Federal agencies and departments which work to protect consumers and are responsible for enforcing legislation related to various issues, including:
Consumer product safety: The Canada Consumer Product Safety Act (CCPSA) regulates the safety of a wide variety of consumer products, except for motor vehicles, food, drugs and animals. The CCPSA is administered by Health Canada.
Packaging, labelling, sale, importation and advertising of prepackaged products: The Consumer Packaging and Labelling Act requires that prepackaged consumer products bear accurate and meaningful labelling information to help consumers make informed purchasing decisions. The Act is administered by the Competition Bureau.
Vehicle safety: The Motor Vehicle Safety Act regulates the manufacture and importation of motor vehicles and motor vehicle equipment to reduce the risk of death, injury and damage to property and the environment. The Act is administered by Transport Canada.
Food, meat and fish inspection, agricultural products, seeds, fertilizers, and animal feed and health: Food Safety and Inspection related Acts are administered by the Canadian Food Inspection Agency.
Safety and nutritional quality of all foods: The Food and Drugs Act establishes standards for the safety and nutritional quality of all foods sold in Canada and is administered by Health Canada.
Federally regulated financial institutions (banks, retail associations and federal trust, loan and insurance companies): Oversight of consumer issues in the federally regulated financial sector are administered by the Financial Consumer Agency of Canada .
Wireless services: The Wireless Code explains your rights and responsibilities as a consumer of wireless services. It establishes standards that all wireless service providers must follow. The Wireless Code applies to all wireless contracts. The Wireless Code was created by the Canadian Radio-television and Telecommunications Commission (CRTC).
In Ontario, consumer’s rights and businesses obligations are identified within the Consumer Protection Act (https://www.ontario.ca/laws/statute/02c30) which covers the most common consumer transactions. The Consumer Protection Act is a key piece of Ontario’s consumer protection framework that came into in 2002. The fast-paced nature of today’s business environment has led to changes in the way people make purchases, and how businesses work; especially with the rise in e-commerce over the years. As a result, consumer protection laws are constantly being updated to remain modern, fair and give consumers confidence that their rights are protected. Moreover, strong consumer protection laws improve Ontario’s reputation as a place for businesses to grow and invest in. When people trust the businesses, products, and services they spend their money on, the economy flourishes.
The Ontario Consumer Protection Act applies to all consumer transactions if the consumer is located in Ontario when the transaction takes place.
A supplier is required to disclose information that must be clear, comprehensible and prominent.
Any ambiguity that allows for more than one reasonable interpretation of a consumer agreement provided by the supplier to the consumer that must be disclosed shall be interpreted to the benefit of the consumer.
No supplier shall demand payment or make any representation that suggests that a consumer is required to make payment in respect of any unsolicited goods or services despite their use, receipt, misuse, loss, damage or theft. This means that if someone just sends you something and then demands payment, the consumer does not have to pay.
If a supplier has received a payment in respect of unsolicited goods or services, the consumer who made the payment may demand a refund of the payment in accordance with section 92 within one year after having made the payment.
A supplier who receives a demand for a refund under subsection (6) shall refund the payment within the prescribed period of time.
It is an unfair practice for a person to make a false, misleading or deceptive representation.
Examples of false, misleading or deceptive representations can include:
It is an unfair practice to make an unconscionable representation. Determining whether a representation is unconscionable, it may be taken into account that the person making the representation or the person’s employer, or principal knows or ought to know:
Each person who engaged in an unfair practice is liable jointly and severally with the person who entered into the agreement with the consumer for any amount to which the consumer is entitled under this section.
A consumer may, without any reason, cancel an agreement. Depending on the type of agreement, the cooling off period may differ and a consumer should check immediately to avoid any confusion.
Every consumer agreement for loan brokering, credit repair or for the supply of such other goods or services as may be prescribed shall be in writing, shall be delivered to the consumer and shall be made in accordance with the prescribed requirements.
Many industries are barred from requiring or accepting any payment or any security for a payment, directly or indirectly, from or on behalf of a consumer. Check to make sure that if the business is asking for a deposit, that they are in fact allowed to do so.
No repairer shall charge a consumer for any work or repairs unless the repairer first gives the consumer an estimate that meets the prescribed requirements.
Consumer protection legislation can be complicated and confusing with overlapping jurisdictions and regulations. However, it is a critical element in the Canadian business landscape as it helps to build trust in consumers. Without trust, businesses will find it difficult to gain new customers. Consumer protection legislation should not be viewed as a burden to businesses, but rather an opportunity to illustrate to customers that they can trust the business or organization they are accessing.