Price-related representations

Several provisions of the Competition Act deal with price representations:

False or misleading ordinary selling price representations - The Competition Act prohibits false or misleading representations, to the public, as to the ordinary selling price of a product, in any form whatever. Under the Act, the ordinary selling price is determined by using one of two tests: either a substantial volume of the product was sold at that price or a higher price, within a reasonable period of time (volume test); or the product was offered for sale, in good faith, for a substantial period of time at that price or a higher price (time test).

Bait and switch selling - The Competition Act prohibits "bait-and-switch" selling which occurs when a product is advertised at a bargain price, but is not available for sale in reasonable quantities. The provision does not apply if 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.

Sale above advertised price - The Competition Act prohibits the sale or rent of a product at a price higher than its advertised price. The provision does not apply if the advertised price was a mistake and the error was immediately corrected.

Double ticketing - The Competition Act prohibits the supply of a product at a price that exceeds the lowest of two or more prices. In other words, where two or more prices are clearly shown on a product, it must be supplied at the lower price.

Scanner Price Accuracy

There is no federal legislation governing price-scanning accuracy. However, some types of price representations that result in overcharges to consumers may be examined under the Competition Act. The Bureau also endorses the Scanner Price Accuracy Voluntary Code, which provides participating retailers of four major associations with a mechanism to provide redress to consumers when there is a scanner error. When the scanned price of an item without a price tag is higher than the shelf price, or any other displayed price, the customer is entitled to receive the item free when it is worth less than $10, or receive a $10 reduction for more expensive items.

For details on how the Competition Bureau enforces the law, please visit our Law and Litigation section.