Jewellery stores - Ordinary selling price representations

On December 27, 2002, and February 18, 2003, the Competition Bureau initiated two separate inquiries into the business practices of companies operating jewellery stores in Montreal, St-Jerome, Terrebonne and Quebec City. These two inquiries resulted from a conformity strategy developed in fall 1999 targeting Canadian jewellery retailers.

The business practices of certain jewellery stores belonging to the companies in question were observed for a number of months. Bureau officers visited the stores and, during each of these visits, noticed that jewellery items were on sale. At no point did the officers see that the jewellery was offered at the ordinary price. During each visit, only a variation in the sale percentage was noticed.

On the basis of these observations, the Bureau concluded that the retailers failed to comply with the provisions concerning ordinary price in subsection 74.01(3) of the Competition Act. This provision prohibits retailers from making representations about the ordinary price of a product without having: (i) sold a substantial volume of the product at that price or a higher price within a reasonable period of time; or (ii) offered the product at that price or a higher price in good faith for a substantial period of time.

As a result of the decision to review the enforcement strategy for jewellery retailers, the Bureau concluded that these two inquiries should be discontinued and another part of the conformity continuumemployed to obtain the competition results sought in this retail sector.

These two inquiries were discontinued on August 30, 2006.

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