Advertising

Regulation

What rules govern advertising on the internet?

Canada has general competition laws and specific anti-spam laws that apply to digital advertising.

The misleading advertising provisions of Canada’s Competition Act apply to all online representations, including those that relate to online sales. If an ad originates outside Canada but may influence the Canadian public, the Competition Act may apply.

Canada’s anti-spam legislation applies to the sending of commercial electronic messages, including ads sent to an electronic address, such as an email address, or direct messages to a social network address. Businesses cannot send commercial electronic messages without the explicit consent of the recipient. Commercial electronic messages must also be in a prescribed form, including information such as sender identification and contract details and a no-cost, easy unsubscribe mechanism. There are some exceptions to these new rules. For example, ‘existing business relationships’ (as narrowly defined in the law) may not have to adhere to the stricter requirements outlined above.

Under privacy laws, privacy commissioners have also imposed restrictions requiring notice and consent with respect to the use of cookies and other internet-tracking technologies for the purpose of behaviourally targeted online advertising.

Other sectoral laws that restrict advertising may also apply to internet-based advertising, such as those that apply to pharmaceuticals, alcohol and tobacco products.

Definition

How is online advertising defined? Could online editorial content be caught by the rules governing advertising?

Laws that include broad restrictions on promotions – such as with respect to alcohol and cannabis products – could potentially apply to editorial content on a website.

Misleading advertising

Are there rules against misleading online advertising?

The Competition Act prohibits misleading representations and deceptive marketing practices, including in electronic communications.

To contravene the Competition Act, either the general impression or the literal meaning of a representation must be materially false or misleading. Materiality is determined by considering whether the representation could influence consumers to buy a product or service and is generally held to extend to representations that influence buyers’ conduct (eg, by inducing consumers to visit one website rather than another).

Ads relating to political campaigns are subject to new regulations that came into effect in 2018. A significant onus is placed on major online platforms to maintain records of those that purchase political ads and to avoid accepting such advertising from foreign actors.

Restrictions

Are there any products or services that may not be advertised on the internet?

Goods and services sold online are generally subject to the same restrictions that apply to advertising in general. The advertising of medications, alcoholic beverages, tobacco products and cannabis is heavily regulated.

Hosting liability

What is the liability of content providers and parties that merely host the content, such as ISPs? Can any other parties be liable?

Liability of ISPs for defamation is a complex issue in Canada, with no specific legislation in place to provide a safe harbour for website owners that remove libellous content within a reasonable period. However, it is possible that the Canadian courts would be influenced in some circumstances by a good-faith effort to remove such content. In addition, the defence of innocent dissemination has been recognised as applying to ISPs that are passive actors, although not necessarily to website owners (see Roy v Ottawa Capital Area Crime Stoppers (2018), an interlocutory ruling from Ontario).

The Copyright Act does not attribute liability to third-party conduits such as ISPs that act as neutral intermediaries. However, these conduits may be liable or have obligations imposed on them if a party holding a copyright provides them with a notice of infringement. Under the ‘notice and notice’ provisions of the Copyright Act, an ISP must forward such a notice to the infringing user and create appropriate records.

There is no similar legislation for trademarks, although ISPs may have to remove infringing content pursuant to any injunction that may be obtained.

Law stated date

Correct on

Give the date on which the information above is accurate.

1 October 2019.