Performance claim without adequate and proper test

A buyer meets the phrase when marketing says how well something performs. Section 74.01(1) of the Competition Act applies to a person who, to promote the supply or use of a product or any business interest, by any means whatever, makes such a representation to the public. Under paragraph (b), the proof of the test lies on the person making the representation. The Competition Bureau says that under the Competition Act it is against the law to advertise or market something in a way that is false or misleading.

What the paragraph covers

Paragraph (b) speaks of the performance, efficacy or length of life of a product. It does not mention franchise earnings, and whether a particular sales or earnings statement falls within it is a legal question. Paragraph (a) separately covers a representation to the public that is false or misleading in a material respect. Section 74.02 covers a representation that a test has been made, and testimonials, subject to the exceptions set out in that section. Checking whether a food franchise is profitable looks at earnings figures.

What to ask

• What test the claim rests on, who ran it and when
• Whether the claim is about a product, about a franchise’s results, or both
• Whether the franchisor will put the basis for the claim in writing