Telemarketing

Telemarketing defined

Section 52.1 of the Competition Act defines telemarketing as: "The practice of using interactive telephone communications for the purpose of promoting, directly or indirectly, the supply or use of a product or for the purpose of promoting, directly or indirectly, any business interest."

The Bureau defines an interactive telephone communication as a live-voice telephone conversation between two or more persons, which excludes pre-recorded telephone messages, Internet or fax communications.

Telemarketers' disclosure requirements

With telemarketing, consumers often do not know with whom they are dealing, and offers are not made in print where they can be carefully considered, or on television or radio where they are repeated often, but are made instead during a telephone conversation. Therefore, the law requires that all of the following facts must be disclosed by the telemarketer to each called person or business at appropriate times during each telephone call.

At the beginning of each call the telemarketer must disclose:

• the name of the company or person the caller is working for;
• the type of product or business interest he or she is promoting; and
• the purpose of the call.

At some other time during each call they must also disclose:

• the price of any product or service being promoted;
• and any restrictions or conditions that must be met before the product is delivered.

In addition, the law forbids telemarketers to:

• make any representation that is false or misleading in a material respect;
• conduct a contest, lottery or other game where delivery of the prize is conditional on payment in advance, or where the approximate value of the prizes and other facts that affect the chances of winning are not fairly disclosed;
• offer a free gift or a product at minimal cost as an inducement to buy a second product (this is acceptable if they disclose the approximate value of the gift or premium);
• and require payment in advance where the price of the product upon delivery is found to be grossly in excess of the fair market value of that product.