Criminal Investigations: Process and Procedure

Remarks of Harry Chandler
Deputy Director of Investigation and Research
(Criminal Matters), Competition Bureau

The Canadian Bar Association
Competition Law Annual Fall Conference
Ottawa, Ontario

September 24, 1998

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Introduction

This paper describes how the Competition Bureau enforces the criminal provisions of the Competition Act. A brief outline of how criminal investigations are initiated and how they are subsequently carried out is presented. The Bureau's priorities related to criminal investigations, fines and penalties and cross-border investigations are subsequently discussed.

Initiating an investigation

As you know, the Competition Bureau administers and enforces the Competition Act which prohibits certain types of anti-competitive activity so that businesses and consumers can enjoy lower costs, reduced prices, improved service and innovative products, all of which are considered to be the benefits of competition. The Director of Investigation and Research ("the Director") is the independent statutory authority responsible for administering and enforcing the Act.

The Competition Act contains both criminal and non-criminal provisions and applies with a few exceptions to all businesses in Canada. The criminal provisions deal with anti-competitive practices such as price fixing, market allocation, bid-rigging, price discrimination, predatory pricing, price maintenance, misleading advertising and deceptive marketing practices.

Criminal investigations may be initiated under the Act in several ways. The majority of investigations are the result of complaints lodged with the Bureau. These complaints typically come from consumers, businesses and/or competitors. Occasionally, they may also come from disgruntled or terminated employees. Once a complaint has been received, it is examined to determine whether it raises any issues under the Act. If there is reason to believe that an offence has been or is about to be committed, the Bureau may commence an inquiry. An inquiry may also be commenced following receipt of an application by six residents of Canada or if the Minister of Industry Canada so directs.

Once an inquiry has been initiated, Bureau staff have at their disposal several investigative tools in the event additional information is required. Further information may simply be obtained by contacting suppliers, customers, competitors or other industry sources. At times, however, information is best obtained as a result of a search and seizure. When so required, the Director can apply to the courts for a warrant authorizing the search of premises and the seizure of evidence. Search warrants are also applicable to computer records. The Director may also apply to the courts for subpoenas requiring a person to give oral evidence, produce records, or provide written evidence. A judge will issue search warrants or court orders provided that an inquiry has been commenced and that the evidence relevant to the inquiry may be obtained from the premises or persons involved.

Enforcement Tools

Searches

Typically, searches are carried out during business hours and are exercised without warning. Bureau officers will arrive at the premises in possession of a search warrant authorizing them to examine all relevant company records. At times, a company suspected of wrong-doing may have a number of premises at different locations. In such instances, teams of officers armed with warrants, are sent out to all locations and the searches are carried out simultaneously. Such sudden and unexpected investigations are meant to take the target company by surprise and may be the first indication they have that the Bureau is conducting an inquiry.

During the course of a search, Bureau officers may be approached by employees wishing to voluntarily provide information or evidence regarding the investigation at hand. Other scenarios may include an individual unknowingly giving out information which may prove to be inculpatory. In either case, the Bureau has procedures, which conform to Charter requirements, to be followed when gathering oral evidence or when interviewing individuals with respect to criminal offences. We also suggest that individuals who are or may become a target of investigation, obtain separate legal counsel rather than relying of counsel retained by the company being investigated.

Electronic searches

While searches of premises have been authorized by the Competition Act or its predecessors for many years, there have been additions to reflect new developments. For example, provisions dealing with the search of computer systems were added to the Act in 1986. In accordance with section 16 of the Act, a person authorized to search pursuant to a search warrant may use or cause to be used any computer system on the premises in order to obtain records authorized by the warrant. The data which is retrieved and covered by the warrant may be copied or may be reproduced in the "form of a print-out or any other intelligible output" and may then be seized.

The Bureau has specially trained search officers to conduct electronic searches. These officers are able to successfully access computers to search for, examine, retrieve, reproduce and seize records found in the form of electronic data using forensic procedures designed to ensure the integrity of the evidentiary process of obtaining and maintaining records.

Electronic searches are an onerous and time-consuming endeavour. Storage devices for electronic data such as hard disks, tapes and large capacity diskettes can hold vast amounts of data.

Officers are entitled to seize any records or other thing on the premises named in the warrant. This means that portable computers may be searched as may pocket and hand-held electronic diaries or personal digital assistants which may contain calendars, telephone lists, or other information.

Oral evidence under oath

The taking of oral evidence may be done formally pursuant to section 11 of the Act or may simply involve the taking of sworn statements. The taking of oral statements permits the gathering of further evidence which can aid in assessing the merits of a case. Pursuant to recommendations from the courts, the Bureau has been increasingly using videotaped statements. Those who wilfully give false testimony material to the issue or matter of the inquiry may be subject to section 131 of the Criminal Code (perjury) or may be subject to section 64 of the Act (obstruction) for which a maximum fine of $ 5 000 or 2 years in prison may be imposed. This is an area where we are becoming increasingly vigilant in order to guard the integrity of our inquiries. In the Toronto Electrical Contractors case, an individual pleaded guilty to obstruction charges pursuant to section 64 of the Act and was fined accordingly.

Wiretaps

Bill C-20, currently awaiting Third Reading, proposes, by way of amending section 183 of the Criminal Code, interception of private communications without consent of the target party (ies), as an investigative tool to tackle conspiracies, bid-rigging and the new crime of deceptive telemarketing. In response to stakeholder concerns, the Standing Committee on Industry narrowed the availability of wiretapping to conspiracies involving price-fixing and market-sharing and to deceptive telemarketing involving deceptive marketing practices, leaving its applicability to bid-rigging untouched.

At present, under section 184.2 of the Criminal Code, where there are reasonable grounds to believe that an offence against the Competition Act has been or is about to be committed, the Director can currently apply for authorization to intercept a private communication where either the originator of the private communication, or the person intended by the originator to receive the communication, has consented to the interception.

It should be noted that Bill C-20 will not allow the Director to wiretap on a whim. To grant judicial authorization to intercept private communications without consent, a judge of a superior court of criminal jurisdiction would have to be satisfied on application by the Solicitor General that certain criteria are met. This includes being satisfied that there are reasonable and probable grounds to believe that the offence has been or is about to be committed, it would be in the best interests of the administration of justice to grant authorization, and that other investigative procedures have been tried and have failed or are unlikely to succeed.

Referrals to the Attorney General

After examining the evidence collected, Bureau staff may at any point during an inquiry, remit records, returns or evidence to the Attorney General for consideration as to whether an offence has been or is about to be committed under the Act and for such action as the Attorney General may wish to take. The Attorney General has the sole authority to prosecute violations of the criminal provisions of the Act before criminal courts.

When judging whether or not it is appropriate to refer a matter for prosecution to the Attorney General, a number of factors are taken into account by the Bureau. Previous convictions would be one such consideration. Certainly more emphasis will be placed on prosecution in those cases where the accused is a repeat offender of the Act.

Another factor which will be taken into consideration is the seriousness of the offence. This is often reflected in the penalty provided in the Act itself. The more egregious offences, which generally warrant higher penalties, will certainly be closely examined. The nature of the procedure provided for in the provision itself has an impact. A number of offences under the Act may be prosecuted only on indictment, some only on summary conviction and others by indictment or summarily at the option of the Crown.

The seriousness of an offence is also determined by the facts at hand; the context in which the offence was committed. For example, the amount of commerce affected and the geographic scope of the activity will have an impact on the Bureau's pursuit of the matter. Similarly, we will examine if the conduct at hand was covert and sanctioned by senior members of the firms involved. And further, the Bureau will consider the likelihood of deterring future similar offences by prosecuting, and/or obtaining significant fines against, the firms involved.

Although the Attorney General has the sole authority to bring criminal competition offences to the courts, case officers will remain, for the most part, actively involved in the matter until the conclusion of court proceedings. When appropriate, the Bureau will also make recommendations as to what charges should be laid, who should receive immunity if the case may be, and what fines or penalties should be suggested.

Discontinuance

If a matter does not justify further inquiry, the Director may discontinue the inquiry at any time. Such situations may arise if there is insufficient evidence to make a responsible case and if evidence gathering is not likely to improve with further investigation. For example, oral evidence may prove to be unreliable. Discontinuances may also come about if plausible alternative explanations for certain behaviour arise or if certain activities are industry-regulated. An inquiry may also be discontinued if, pursuant to an Alternative Case Resolution (ACR), further inquiry is not warranted because of voluntary corrective conduct which remedies the competitive concerns arising from the matter under inquiry.

Alternative Case Resolutions

ACRs consist of alternative enforcement options which we may consider or recommend to resolve cases of non-compliance with the Act. ACRs allow us to ensure conformity without having to undertake formal action. These may include investigative visits order to obtain further information or to obtain voluntary compliance with the Act. , written undertakings and/or publication of a corrective notice., the implementation of an in-house corporate compliance program of Investigation and Research, 1997. or even prohibition orders These orders do not require the parties to plead guilty and they will not stand convicted. on consent. When determining whether to resort to ACRs, the Bureau will examine the merits of each case and consider which means of resolution is most consistent with the facts at hand. ACRs may prove to be appropriate for example, when a less serious offence has be en committed, when there are defects in the evidence and when there is willingness on the part of those involved to correct the offensive behaviour. Such alternative enforcement ensures that the goal of enforcing and promoting compliance with the Act is pursued with greater effectiveness and less time and expense than fully contested proceedings.

Immunity/Favourable Treatment

In the investigation of criminal offences, the question of immunity or other forms of favourable treatment may be raised by or with witnesses in exchange for provision of information and their continuing cooperation. Immunity in the context of criminal offences to the Competition Act refers to the specific situation where the Attorney General agrees to refrain from prosecuting an individual or firm in exchange for cooperation, evidence or assistance. Given the respective roles of the Director and the Attorney General in enforcing the Competition Act, it should be stressed that only the Attorney General can grant immunity from prosecution under the Act. Historically, however, the Bureau's recommendations have always received serious and careful consideration by the Attorney General.

Prior to a positive recommendation for immunity, the Bureau gives careful consideration to the general principle that offenders should be punished for their crimes on the one hand, and the value of receiving cooperation regarding serious offences which would otherwise go undetected, on the other hand. As such, requests for immunity are carefully assessed on the basis of policies and objectives of the Bureau and the Attorney General, with considerable emphasis put on the protection of the public interest.

The question of immunity may arise in a variety of situations. There are scenarios where the Bureau is unaware of the offence altogether and the informant approaches the Bureau voluntarily and unexpectedly. The subject of immunity may also be broached unexpectedly by a potential informant during or shortly after a search or hearings have occurred.

It should be noted that immunity recommendations by the Bureau are confined to Competition Act offences and that grants of immunity are conditional upon complete, continuing and honest disclosure of information related to the offence. A failure on the part of the informant to disclose all information within his or her knowledge could result in the withdrawal of the immunization.

Immunity is the most extreme form of favourable treatment and is not always available. Favourable treatment refers to the imposition of a penalty or obligation that is less severe than is the case in the absence of disclosure or cooperation by someone who has violated the Act. It is generally more readily available than immunity as the possibility of prosecution is still available and enforcement is still carried out. Favourable treatment may include pleas to reduced charges, fewer counts and lenient sentencing.

When determining whether immunity or favourable treatment should be recommended, Bureau staff will examine a number of factors such as the available evidence without the proffered cooperation, whether the testimony or evidence can be obtained from another source, past cooperation with law enforcement officials and witness credibility.

Negotiated Settlements

Whether considering immunity, favourable treatment, or even fines and penalties it is important to keep in mind that the Attorney General, in consultation with the Bureau, is willing to consider a settlement which involves a plea and cooperation on the part of those being investigated. At any stage of the investigative process, the Bureau and/or the Attorney General may be approached to discuss possible remedies to the situation at hand. The investigation will continue, concurrently with discussions with the parties, in order to properly discharge our investigative responsibilities. A settlement, involving a plea and continuing cooperation, may result. Negotiation discussions must strike a balance between providing what the party is requesting (i.e. immunity, lenient sentencing) to encouraging deterrence of further anti-competitive behaviour and providing the tools to ensure compliance with the Act. In such cases, sentencing by the Courts will be done on the basis of a joint submission by the Crown and the defence. Negotiations lead to responsible settlements which are often less costly and time-consuming than fully contested proceedings.

Criminal liability of individuals and corporations

Under the Competition Act, both individuals and corporations may be held responsible for their conduct. The personal liability of individuals is as important as the financial penalties imposed on corporations in terms of effective enforcement of the Act. Historically, individuals were mainly prosecuted for competition offences when they were carrying on business for themselves. Individuals, however, may also be prosecuted and convicted with their corporate principles. For example, in 1996, the operator of a small driving school in Sherbrooke, Quebec was found guilty of the six counts charged against him and sentenced to one year in jail for offences under the Act. In 1997, a $ 550, 000 personal fine was imposed on a former senior official of a garbage collection company for his role in a conspiracy to unduly lessen competition.

As you all know, to prosecute and convict an individual of a criminal offence, the Crown must prove the actus reus or prohibited conduct and the mens rea or mental state. With regard to corporate criminal liability, an individual who is the directing mind of a corporation who performs unlawful acts within the framework of the corporation's operations may render the corporation criminally liable.

Bureau Priorities

The Bureau, just like many other government bodies, has had to tighten its belt over the past few years. As such, the Bureau has to become more efficient with finite resources, while at the same time maximizing conformity with the law. In the area of criminal enforcement, this has lead the Bureau to concentrate on those activities which can cause the most serious economic harm; conspiracies, bid-rigging and egregious criminal conduct in the area of deceptive marketing practices.

This does not mean, however, that other criminal matters dealt with under the Act are unimportant; nor does it mean that investigations of clear offences under other criminal provisions will not be undertaken by the Bureau.

One of the priority areas, section 45 (conspiracy), states that it is an indictable offence for any person to conspire, combine, agree or arrange with another person to prevent, limit or lessen unduly competition.

Two recent and interesting examples of conspiracy are the lysine and citric acid cases. Earlier this year, the Federal Court of Canada imposed fines totalling close to $20 million against a number of companies in the food and feed additives sector. The largest fine ever imposed under the Competition Act, $16 million, was levied against Archer Daniel Midland Corporation (ADM), a United States corporation. ADM pleaded guilty to having participated in world-wide price-fixing and market sharing conspiracies in the lysine and citric acid markets.

The penalty levied against ADM demonstrates that Canada will not tolerate blatant and intentional criminal behaviour designed to harm Canadian businesses and consumers. The Bureau and the Attorney General will continue to seek fines against other participants in these and similar conspiracies affecting Canada.

The Competition Act also has a prohibition against agreements relating to bid-rigging activities. Another priority area relates to section 47 which prohibits the submission of bids arrived at by agreement in response to a call for bids or tenders and also to agreements to refrain from submitting a bid in response to a call or request for tenders. This, however, does not apply to situations where the agreement is made known to the tendering authority before bids are made, or where the agreement involves affiliated companies.

An example of a bid-rigging case in which we obtained guilty pleas in 1997 and 1998, is the Toronto Electrical Contractors' case. The bid-rigging schemes targeted primarily tenders for the renovation of commercial office space including certain leasehold improvements at Pearson Airport's Terminal III. Some of the companies were also convicted of rigging tenders related to new construction projects such as the SkyDome Hotel and BCE Place - Phase 2.

As a first for the Bureau, in a case involving 13 charges of pyramid selling and multi-level marketing (MLM), one of the charges was related to the use of the Internet. The Integrity Group was found guilty of 11 counts and fined $150, 000. The company's Web site was used to promote the MLM plan which contained earning representations but failed to disclose the earnings of a typical participant as required by the Act.

This May, the courts fined The Office Supply Centre and its principal a record $250,000 in a telemarketing case involving 'toner pirates'. The company in this case misrepresented themselves as regular suppliers of toner to the detriment of small businesses, charities and churches.

Fines and Penalties

These cases demonstrate that there are significant penalties for violating the Act. Penalties to the criminal provisions of the Competition Act include fines, imprisonment, or both. In recent years, the courts have imposed greater fines which better reflect the injury inflicted to the Canadian economy as a whole caused by anti-competitive activity.

The guiding principles the Courts have used to determine sentences are those of deterrence and example. The fine imposed must be large enough to deter others from engaging in similar conduct and must at the same time set an example. Historically, the Courts have also taken into consideration the volume of commerce affected, the size of the firm involved, previous convictions, the length of time the offending conduct was carried out and whether the behaviour was part of a deliberate corporate policy.

In addition to fines or imprisonment, prohibition orders may also be issued. These orders will seek to prohibit the continuing or repetition of all anti-competitive conduct uncovered during an inquiry and may be imposed for a length of time as recommended by the Attorney General (ten years unless the court specifies a shorter period). When such orders are issued, they are usually broadly worded and may be sought against corporations, their officers, directors and even employees. Failure to comply with an order renders the accused liable to a fine at the discretion of the court or to imprisonment for a term not exceeding two years.

Cross-Border Investigations

Inasmuch as the enforcement of the Competition Act relates to activities affecting the domestic market, the globalization and liberalization of barriers to trade have presented new challenges of an international nature as business activities beyond our borders can have very decided effects in Canada. When such activities are anti-competitive in nature, the Bureau seeks to remedy the situation no matter the origin of the business decision. The reduction and elimination of government barriers to trade and the emergence of international corporations has led to a surge in business activity which in turn has increased the likelihood of international cross-border anti-competitive activity.

This globalization of commerce has had many implications, one of which has been the on-going cooperation among anti-trust authorities seeking to ensure compliance and deterrence. This holds particularly true for a country like Canada which has a heavy reliance on trade and which also happens to share a long border with the United States. Canada and the U.S. have been at the forefront of exploring mutual assistance using the framework of instruments of cooperation between competition authorities.

These instruments of cooperation with the U.S. Department of Justice and the Federal Trade Commission can be found in the agreement signed in 1995 called the Canada-U.S. Agreement which replaces the 1984 Memorandum of Understanding. This agreement commits both governments to notification, consultation and cooperation. The agreement outlines that each Party will notify the other whenever its enforcement action might affect the other Party's important interest. The agreement also encourages the Parties to coordinate their activities when both are investigating the same or related trans-border conduct and establishes guiding principles with respect to such coordination.

Criminal information is also exchanged under the Canada-U.S. Mutual Legal Assistance Treaty (MLAT) which allows enforcement authorities of either country to obtain evidence of criminal offences by the sharing of information (subject to confidential requirements) and by invoking the assistance of compulsory processes, such as search warrants, in the other country.

Cooperation and coordination of competition policy is also further reinforced by regular contacts and meetings of officials from the relevant agencies to share experiences and discuss matters of current mutual interest. These regular inter-agency contacts are just as important as the formal relationships, since they provide the opportunity to share information and new developments in the competition field. As some of you may know, in August, we illustrated the Canada - U.S. cooperation dynamics in a role play scenario whereby Canadian and U.S. competition officials were conducting parallel investigations. The sketch was presented at the American Bar Association's Annual Conference in Toronto.

Further, the Bureau is very much involved in joint work under the agreement Establishing the Taskforce on Cross-Border Deceptive Marketing Practices. This endeavour has brought together the efforts of the Federal Trade Commission, the U.S. Department of Justice, the Federal Bureau of Investigation, the Competition Bureau, the Royal Canadian Mounted Police and the Ontario Provincial Police to combat deceptive telemarketers who, until recently, rendered enforcement difficult through their cross-border activities. Working together, we are now more effective in pursuing these matters.

Canada is also now finalizing a cooperation agreement with the European Community (E.U.). Along the lines of the 1995 Canada - U.S agreement, the proposed agreement with the E.U. will provide tools to improve the enforcement of the Competition Act in relation to cross-border anti-competitive activities which can impair the benefits of increased trade between Canada and the E.U.

Such international cooperation is beneficial and highly effective. It permits us to obtain evidence which at times would have simply been out of our reach. It also allows for synergies in terms in reducing the amount of resources expended by each agency in an investigation. It presents a united front and, as such, further promotes international relations.

Conclusion

The aim of the Bureau is to seek compliance with the Competition Act. The purpose of criminal investigations is to determine the level of enforcement action necessary to achieve compliance. The Bureau's efforts towards ensuring compliance has been premised on the notion that businesses want to comply with the law. To this effect, the Bureau has provided the business community with a range of tools to achieve compliance.

Where businesses are unwilling to conform there are well established investigative processes and procedures to protect competition and to ensure accurate marketplace information. The Act establishes procedures with regard to the conduct of investigations which ensure compliance with the Act itself, the integrity of the evidentiary process and prosecutions where warranted. International cooperation has also proven itself to be an invaluable tool in carrying out criminal investigations.

Both our legislation and the procedures for its application are continuously adapted to respond to new and changing methods of engaging in economic crime. We will ensure that all anti-competitive criminal activity is either appropriately halted in its wake or prosecuted to the full extent of the law.

Appendix I

A BRIEF OUTLINE OF

THE CRIMINAL PROVISIONS OF THE COMPETITION ACT

Part VI of the Competition Act prohibits under criminal sanction specified trade practices, bid-rigging, agreements or arrangements which lessen competition unduly, misleading advertising and deceptive marketing practices. For operational and statistical purposes, those offences found in sections 45 to 51 and section 61, which may be loosely characterized as offences in relation to competition, are treated separately from the misleading advertising and deceptive marketing practices provisions found in section 52 through 60. The following offences are included in this group:

• Conspiracies, combinations, agreements or arrangements to lessen competition unduly in relation to the supply, manufacture or production of a product (section 45);
• Bid-rigging, where two or more persons agree that one party will refrain from bidding in a call for tenders, or where there is collusion in the submission of bids, unless such actions are made known to the tendering authority (section 47);
• Knowingly engaging in a practice of discriminating against competitors of a purchaser of an article by granting a discount or other advantage to a purchaser that is not available to competitors purchasing articles of like quality and quantity (paragraph 50(1)(a));
• Engaging in a policy of selling products in any area of Canada at prices lower than those exacted elsewhere in Canada, where the effect or design is to lessen competition substantially or eliminate a competitor (paragraph 50(1)(b));
• Engaging in a policy of selling products at unreasonably low prices where the effect or design is to lessen competition substantially or eliminate a competitor (paragraph 50(1)(c));
• Granting to a purchaser an allowance for advertising or displays purposes that is not offered on proportionate terms to competing purchasers (section 51);
• Attempting to influence upward or to discourage the reduction of the price at which another person supplies or advertises a product or refusing to supply or otherwise discriminating against anyone because of that person's low pricing policy (subsection 61(1));
• Attempting to induce a supplier to refuse to supply a product to a particular person because of that person's low pricing policy (subsection 61(6)).

Other provisions relate to the implementation of foreign directives (section 46), agreements relating to participation in professional sport (section 48) and agreements among banks (section 49). A number of exclusions and exceptions are applicable to these provisions, as well as certain defenses. For greater certainty, readers are advised to consult the legislation.

Appendix II

PROVISIONS RELATING TO MISLEADING ADVERTISING AND DECEPTIVE MARKETING PRACTICES

Section 52(1)(a): All representations, in any form whatever, that are false or misleading in a material respect are prohibited. This general provision prohibits all misleading representations not specifically prohibited elsewhere.

Section 52(1)(b): Any representation in the form of a statement, warranty or guarantee of the performance, efficacy or length of life of a product, not based on an adequate and proper test, is prohibited. The onus is on the one making the claim to prove that it is based on an adequate and proper test.

Section 52(1)(c): This paragraph covers any representation that purports to be a warranty or guarantee of a product, or a promise to replace, maintain or repair an article, or any part of an article. Such representations are prohibited where their form is materially misleading or where there is no reasonable prospect that the warranty, guarantee or promise will be carried out.

Section 52(1)(d): Any materially misleading representation as to the price at which a product is ordinarily sold is prohibited. Here, price means the price that the product ordinarily sells for in the market area, unless specified to be the advertiser's own selling price.

Section 53: Untrue, Misleading or Unauthorized Use of Tests and Testimonials. This section prohibits publishing a testimonial or representing that another person has made a test as to the performance, efficacy or length of life of an advertised product, except where (a) the third person who gave the testimonial or made the test has previously published the testimonial or represented that he or she has made the test; or (b) where the person, prior to publishing the testimonial or representation that a test has been conducted, has secured in writing the third party's approval of the testimonial or representation as well as permission to publish or make it.

Section 54:Where two or more prices are clearly shown on a product, its container or wrapper, the product must be supplied at the lower price. This provision does not actually prohibit the existence of two or more prices, but requires that the product be offered for sale at the lowest price depicted.

Sections 55 and 56: Pyramid and Multi-level marketing schemes. Under these sections, a person who induces or invites another to participate in a pyramid or referral selling scheme, as defined, commits an offence.

Section 57: Advertising a product at a bargain price that the advertiser does not have available for sale in reasonable quantities is prohibited. Liability will be avoided where the advertiser can establish that the non-availability of the product was due to circumstances beyond its control, the quantity of the product obtained was reasonable, or the customer was offered a rain check when supplies were exhausted.

Section 58: The supply of any product at a price higher than the price currently being advertised is prohibited. This section does not apply where the price advertised was erroneous and immediately corrected, or where the seller is not a person engaged in the business of dealing in that product.

Section 59: Any contest that does not disclose the number and approximate value of prizes or important information relating to the chances of winning in the contest, that does not select participants or distribute prizes on the basis of skill or on a random basis, or in which the distribution of prizes in unduly delayed, is prohibited.