The Competition Bureau has sent warning letters to operators of clothing donation bins in the Montréal area requiring them to make corrections to the information on their bins. This follows similar action in Vancouver in 2014, and an accompanying Advisory.
The Bureau is concerned with for-profit businesses leaving the false impression that consumers are giving to charity. For example, certain bins may use symbols or logos of charitable organizations implying that proceeds from donations go to charitable organizations or that the donations are collected by charities or not-for-profits, when in fact the collections are for-profit, with only a small percentage of proceeds going to charity. The 2014 Advisory notes that bins promoting “in support of …” may not be giving the consumer the best information to make an informed decision. The misimpression diverts donations from charities, and endangers the ability of charities to collect.
The warnings are timely since the closure of Goodwill stores across Ontario has left a void for consumers looking to donate clothing and other articles. Upcycling, reusing and repurposing clothing is trendy, and has bolstered the market for used clothing. If the donations are being collected for profit, this should be made clear.
The Competition Bureau has invited complaints from consumers who see other organizations using a similar approach.