Competition Act

Definition of telemarketing

• 52.1 (1) In this section, telemarketing means 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.

• Marginal note:Required disclosures

  (2) No person shall engage in telemarketing unless

  • (a) disclosure is made, in a fair and reasonable manner at the beginning of each telephone communication, of the identity of the person on behalf of whom the communication is made, the nature of the product or business interest being promoted and the purposes of the communication;

  • (b) disclosure is made, in a fair, reasonable and timely manner, of the price of any product whose supply or use is being promoted and any material restrictions, terms or conditions applicable to its delivery; and

  • (c) disclosure is made, in a fair, reasonable and timely manner, of such other information in relation to the product as may be prescribed by the regulations.

• Marginal note:Deceptive telemarketing

  (3) No person who engages in telemarketing shall

  • (a) make a representation that is false or misleading in a material respect;

  • (b) conduct or purport to conduct a contest, lottery or game of chance, skill or mixed chance and skill, where

    • (i) the delivery of a prize or other benefit to a participant in the contest, lottery or game is, or is represented to be, conditional on the prior payment of any amount by the participant, or

    • (ii) adequate and fair disclosure is not made of the number and approximate value of the prizes, of the area or areas to which they relate and of any fact within the person’s knowledge, that affects materially the chances of winning;

  • (c) offer a product at no cost, or at a price less than the fair market value of the product, in consideration of the supply or use of another product, unless fair, reasonable and timely disclosure is made of the fair market value of the first product and of any restrictions, terms or conditions applicable to its supply to the purchaser; or

  • (d) offer a product for sale at a price grossly in excess of its fair market value, where delivery of the product is, or is represented to be, conditional on prior payment by the purchaser.

• Marginal note:General impression to be considered

  (4) In a prosecution for a contravention of paragraph (3)(a), the general impression conveyed by a representation as well as its literal meaning shall be taken into account in determining whether or not the representation is false or misleading in a material respect.

• Marginal note:Exception

  (5) The disclosure of information referred to in paragraph (2)(b) or (c) or (3)(b) or (c) must be made during the course of a telephone communication unless it is established by the accused that the information was disclosed within a reasonable time before the communication, by any means, and the information was not requested during the telephone communication.

• Marginal note:Due diligence

  (6) No person shall be convicted of an offence under this section who establishes that the person exercised due diligence to prevent the commission of the offence.

• Marginal note:Offences by employees or agents

  (7) Notwithstanding subsection (6), in the prosecution of a corporation for an offence under this section, it is sufficient proof of the offence to establish that it was committed by an employee or agent of the corporation, whether or not the employee or agent is identified, unless the corporation establishes that the corporation exercised due diligence to prevent the commission of the offence.

• Marginal note:Liability of officers and directors

  (8) Where a corporation commits an offence under this section, any officer or director of the corporation who is in a position to direct or influence the policies of the corporation in respect of conduct prohibited by this section is a party to and guilty of the offence and is liable to the punishment provided for the offence, whether or not the corporation has been prosecuted or convicted, unless the officer or director establishes that the officer or director exercised due diligence to prevent the commission of the offence.

• Marginal note:Offence and punishment

  (9) Any person who contravenes subsection (2) or (3) is guilty of an offence and liable

  • (a) on conviction on indictment, to a fine in the discretion of the court or to imprisonment for a term not exceeding 14 years, or to both; or

  • (b) on summary conviction, to a fine not exceeding $200,000 or to imprisonment for a term not exceeding one year, or to both.

• Marginal note:Sentencing

  (10) In sentencing a person convicted of an offence under this section, the court shall consider, among other factors, the following aggravating factors:

  • (a) the use of lists of persons previously deceived by means of telemarketing;

  • (b) characteristics of the persons to whom the telemarketing was directed, including classes of persons who are especially vulnerable to abusive tactics;

  • (c) the amount of the proceeds realized by the person from the telemarketing;

  • (d) previous convictions of the person under this section or under section 52 in respect of conduct prohibited by this section; and

  • (e) the manner in which information is conveyed, including the use of abusive tactics.