The Competition Bureau recently announced that it had taken action under the Competition Act against Moose Knuckles, a Canadian-based manufacturer of premium winter jackets, for alleged deceptive marketing practices associated with its high-end parkas. The Bureau’s application to the Competition Tribunal alleges that the jackets are marketed as “Made in Canada” when the winter apparel is mostly manufactured in Asia with only the finishing touches to the parkas, such as adding the trim, zippers and snaps, being done in Canada. The Bureau is seeking an end to what it believes to be false or misleading “Made in Canada” representations, an administrative monetary penalty and restitution for consumers.
In December, 2009, the Bureau issued Guidelines for “Made in Canada” and “Product of Canada” claims which provided that a “Made in Canada” claim would be unlikely to raise concerns under the false or misleading representation provisions of the Competition Act if:
- the last substantial transformation of the good occurred in Canada;
- at least 51% of the total direct costs of producing or manufacturing the good were incurred in Canada; and
- the ‘Made in Canada’ representation was accompanied by a qualifying statement, such as “Made in Canada with imported parts” or “Made in Canada with domestic and imported parts” (this could also include more specific information such as “Made in Canada with 60% Canadian content and 40% imported content”).
It should be noted that the Guidelines which are provided by the Bureau to the public for convenience and guidance in applying the provisions of the Competition Act are not a legal document and, as such, do not have the force of law.