Advertising and marketing play a big role in influencing people when they buy products. However, in the goal of selling more, advertisers and marketers may sometimes cross the boundaries. Industry standards such as the Canadian Code of Advertising Standards guide advertisers and marketers in the conduct of their business and provide consumers with basis whenever they have complaints and grievances.
What are the Canadian advertising standards?
The Canadian Code of Advertising Standards are the set criteria for entities engaged in the business of advertising and marketing of what is considered acceptable, accurate, and truthful. It is accepted by advertisers, marketing agencies, media outlets, and suppliers. The Code is also the basis for evaluation whenever there are consumer complaints against advertising and marketing agencies, or complaints between these entities.
The Canadian advertising standards are primarily administered by Advertising Standards Canada (Ad Standards), the self-regulatory body of the advertising and marketing industry. It also handles complaints by consumers and advertisers alike.
Ad Standards likewise reviews and revises the Code to adapt to changes and emerging methods of advertising and marketing.
To clarify aspects of our Ad Dispute Procedure, we have created a new resource page: https://t.co/ZUmfDAyJT1.
— Ad Standards (@AdStandardsCan) January 5, 2022
Procedural Note 1 explains how to create an acceptable submission to launch a dispute between advertisers under the Canadian Code. #thecode #selfregulation #advertising
The implementation of Canadian advertising standards is without prejudice to other Canadian laws on advertising and marketing, both in the federal and provincial levels.
In essence, it is understood that the Code and these laws complement each other. Some of the federal laws that advertising and marketing companies should be aware of are:
- The Competition Act
- Personal Information Protection and Electronic Documents Act
- Canada’s Anti-Spam Legislation
Principles of Canadian advertising standards
The provisions of Canadian advertising standards lay out the principles that advertisers and marketing agencies must adhere to, both in letter and in spirit.
Accurate and Clear Messaging
While the intent of advertisers may be different from what has been conveyed in the message, it is the perception of the consumer on the message that will prevail. Therefore, advertisers must carefully craft its ads and marketing ploys to convey truthful and accurate information regarding their products.
Ads must only contain factual information relayed in a clear, understandable manner. It must not contain any misrepresentations or claims that are deceptive or misleading to the public. It must also not omit any information when such an omission might result in misinterpretation or misinformation.
Whenever ads include disclaimers and other footnotes, it must not contradict the main message of the ad which may be interpreted as intent to misinform or deceive the public.
Advertisers must also be identified in the ads except in teaser advertisements. Teasers are ads that only reveal little information about the product, service, or event.
Most of these provisions are also prohibited under the Competition Act. Watch this video for more details regarding the Act:
For guidance on the Competition Act, talk to a lawyer in your province or territory. If you live in Ottawa, for example, consult one of Lexpert's top-ranked advertising and marketing lawyers in Ontario.
Evidence-based Ads
Claims and representations made in ads must be evidence-based. When ads are supported by tests and survey data, these must be conducted according to the acceptable standards of research.
These pieces of evidence, tests, and survey data must also be disclosed by advertisers and marketing companies upon request by Ad Standards.
Whenever ads are supported by statements from professionals and scientistic authorities, it must not be distorted to portray a different meaning other than what was intended. It must apply within the Canadian context whenever possible.
Testimonials, endorsements, opinions, or preferences of individuals or organizations must be genuine. These must be based on actual experience by the testifying individual or organization.
Prohibited Methods of Advertising and Marketing
Ads must not be presented in a manner or format that intentionally disguises it as any message other than an advertisement.
Misrepresentations in the form of “bait and switching” are also prohibited. Bait and switching occurs when a product is offered or marketed at a bargain price, only for it to be unreasonably “unavailable”, to bait a prospective buyer into purchasing another similar product that’s more expensive.
Ads must also refrain from including any –
- discriminatory statements based on sex, gender, race, age, religion, or disability
- statements which promote violence and bullying
- degrading or disparaging statements against a particular group or population
Clear Pricing in Ads
It’s against the law for ads to include any claims, discounts, or price comparisons that are deceptive, unrealistic, or exaggerated.
The following terms must only be used to represent prices whenever the advertising company has sold products in the place where the ads are located:
- “regular price”
- “suggested retail price”
- “manufacturer’s list price”
- “fair market value”
Also, the ads bearing the terms “up to”, “XX off”, or any other words used to describe price discounts must be located near the product which it refers to. The ads must be easily readable and must include regular prices for easy comparison. Ads that use currencies other than Canadian dollars must also be easily identified.
Fair Competition
Canadian advertising standards promote fair competition by disallowing the use of ads to attack or discredit another competitor and by prohibiting the imitation of ads of another competitor.
Advertising to Minors and Children
Ads that are targeted at minors and children must be age sensitive. These ads must not exploit their gullibility and must not include messages which may promote harmful and dangerous acts.
Scope and Exceptions
Some ads and entities are exempt from the coverage of these Canadian advertising standards. Generally, those which do not fall under the Code’s description of an “advertising” and “advertisements” are excluded.
Political and election advertising are also exempt to support free expression of public opinion or ideas. Foreign media are also naturally exempt from the scope of Canadian advertising standards.
Do Canadian advertising standards have legal authority?
There are two procedures to resolve complaints:
- Advertising dispute procedure: when the complainant is also an advertising or marketing company; and
- Consumer complaint procedure: when the complainant is a private individual or organization.
Complainants are not prevented from filing formal lawsuits before the regular Canadian courts based on the federal and provincial laws on advertising and marketing.
Interested to learn more about other Canadian advertising standards? Consult with the Lexpert best-ranked advertising and marketing lawyers in Canada.