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“Buy Now, Pay Later” Promotions and Fine Print Under Scrutiny Deceptive Marketing Practices Remain a Priority For Competition
juil. 11, 2013
The Competition Bureau has brought a lawsuit in the Ontario Superior Court against two of Canada's largest home furniture retailers,
Leon's Furniture Limited and The Brick Ltd. seeking, among other things, refunds for customers who participated in “buy now, pay
later” promotions, as well as Administrative Monetary Penalties under the Competition Act.
In a press release issued July 9, 2013, the Competition Bureau stated that its investigation revealed that customers had to pay
up-front fees to participate in the promotion, notwithstanding the “pay later” promise, resulting in an item costing customers more than
the advertised price. The example given in the press release is a sofa advertised at $1500. Customers wanting to defer payment on
the sofa could end up paying more than $350 at the time of purchase depending on processing or administrative fees, delivery fees
The Commissioner of Competition, John Pecman stated in the release:
"Canadian consumers must receive clear and accurate information about what must be paid at the time of purchase, and what the actual
cost of a particular item is if they use a deferred payment option.”
The Competition Bureau is alleging that Leon’s and the Brick buried details of the up-front fees and the real cost to customers of
furniture bought using deferred payment in fine print.
This is consistent with the Competition Bureau’s policy of ensuring consumers are aware of the amount they are actually paying for a
product. As an example, in 2009, the Competition Bureau issuedConsumer Rebate Promotions enforcement guidelines, which prohibit
price rebates that disguise the price customers pay at the time of purchase.
The Competition Bureau’s press release can be found at: http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03582.html.
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