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Archived — Zellers agrees to take action to correct misleading promotion

OTTAWA, June 29, 2010 — The Competition Bureau announced today that Zellers Inc., owned by the Hudson's Bay Company, has agreed to take steps to address the Bureau's conclusion that a Zellers' misleading savings card promotion violated the Competition Act.

Zellers was promoting the savings cards, valued at $10, with the purchase of the movie Avatar on DVD or Blu-Ray. One of the conditions associated with the savings card was a $50 minimum purchase in order to redeem the savings card. The Bureau's review revealed that this condition was omitted from the advertising for this promotion and only disclosed after consumers made their initial purchase. Terms and conditions associated with these types of promotions that are not fully disclosed to consumers before the time of purchase raise concerns under the false or misleading representations provisions of the Competition Act.

Misleading pricing representations remain a key concern for the Bureau. When making their purchasing decisions, consumers have the right to expect that information about pricing is truthful and accurate. Otherwise, consumers are hurt and rival businesses are put at an unfair competitive disadvantage.

Zellers has agreed to take the following immediate steps to resolve the Bureau's concerns:

  • Customers who present a $10 savings card, or a sales receipt for the movie Avatar purchased between April 22 and 24, 2010, will receive a $10 credit with no minimum purchase required; and
  • The redemption period will be extended to August 6, 2010.

Zellers will bring these changes to the attention of consumers through in-store signage and a notice posted on their Web site. Two corrective notices will also be published in major Canadian newspapers, and Zellers will advertise the details of the redemption in their flyers.

The Bureau reminds retailers of the importance of clearly and conspicuously disclosing, prior to consumer purchases, all material conditions, limitations and exclusions as they relate to rebates and other types of promotions. Businesses are encouraged to consult the Enforcement Guidelines on Consumer Rebate Promotions, which describe the Bureau's approach to interpreting the false or misleading representations provisions of the Competition Act, the Consumer Packaging and Labelling Act, and the Textile Labelling Act in the area of consumer rebate promotions. While the Guidelines deal with rebate promotions, the principles outlined in the document are relevant to other types of promotions as well.

The Competition Bureau is an independent law enforcement agency that contributes to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.


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