The Canadian government recently passed Bill C-59, introducing significant amendments to the Competition Act that directly affect how businesses communicate their environmental efforts. We at Fever want to ensure you understand these changes and their potential impact on your business.
What’s Changed?
Bill C-59 introduces new scrutiny on environmental claims. Previously, the Competition Bureau could take action against false or misleading environmental claims under general provisions. However, Bill C-59 introduces explicit provisions targeting specific representations about a product’s environmental benefits or a company’s broader environmental impact.
Key Changes
- Substantiation: It’s no longer enough to make a claim in good faith – you need concrete evidence to support it. Any statement about environmental benefits related to a product or an entire business operation must be supported by an “adequate and proper test” or follow “internationally recognized methodology.”
- Reverse Onus: If challenged, the burden of proof now rests on the business to prove the validity of their environmental claims.
- Steeper Penalties: Non-compliance can result in substantial fines, with penalties reaching millions of dollars.
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Navigating Challenges
We understand that these changes may seem daunting. Some of the challenges businesses are likely to face include:
- Uncertainty: The phrases “adequate and proper test” and “internationally recognized methodology” are new terms that aren’t defined in the Competition Act. Their meanings are unclear at this time.
- Increased Examination: Expect more attention from regulators, competitors, and consumer advocacy groups.
- Resource Intensive: Gathering and maintaining evidence to support your claims can be a time-consuming and costly process.
- Potential for Overcaution: There’s a risk that businesses may avoid making environmental claims altogether, even if they are genuinely creating positive change.
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We’re Here to Help
Navigating this new regulatory landscape can be complex. We’re here to help as we work alongside clients to develop brand stories and communication, especially those around ESG.
Disclaimer: This blog post is for informational purposes only and should not be taken as legal advice or a guarantee of compliance. We recommend seeking professional counsel to assess the specific implications of this legislation for your business.