Competition Act: reviews and prices

The Competition Act is Canada's federal law against misleading marketing, and two of its rules matter a lot for small businesses online. First, reviews: posting fake reviews, having staff or friends review you without disclosure, offering undisclosed rewards for reviews or selectively hiding bad ones can all be treated as misleading representations. Second, advertised prices: since 2022 the Act explicitly treats drip pricing, advertising a price that cannot be paid because mandatory fees are added later, as deceptive. Taxes imposed by law can be shown separately, but other compulsory fees generally have to be included in the price you advertise.

These rules apply to Google and Facebook ads, your website, your Google Business Profile, flyers and social posts alike. Below is a plain-English overview with practical examples. It is not legal advice; if a specific practice worries you, ask a lawyer who handles competition or advertising law, and check provincial consumer protection rules too.

The general rule

The Competition Act prohibits making representations to the public that are false or misleading in a material respect, meaning they could influence someone's decision to buy. What matters is the general impression a reasonable customer gets, not just the literal wording. A technically true claim can still mislead if the overall picture is wrong.

The Competition Bureau enforces the Act. Most cases are civil, with administrative monetary penalties that, for businesses, can reach up to $10 million for a first order or more for repeat ones, or amounts based on the benefit or revenue involved. Deliberate or reckless deception can be prosecuted as a crime. Recent amendments have also made it easier for private parties to bring certain deceptive marketing cases before the Competition Tribunal.

Online reviews: what crosses the line

The Bureau has treated reviews as representations by the business when the business creates, controls or influences them. Practices that are risky:

• Writing reviews yourself or asking staff, family or friends to post them as if they were ordinary customers.
• Buying reviews or using services that post them.
• Paying or rewarding reviewers without clear disclosure. If you offer something in exchange for a review, the connection should be disclosed in the review.
• Review gating: asking customers how they felt first, then sending only happy ones to Google and routing unhappy ones to a private form. This can create a misleadingly positive picture.
• Selectively publishing only positive reviews on your website while presenting them as representative.
• Reviewing competitors negatively under fake identities.

Platforms like Google also have their own policies against many of these practices and can remove reviews or restrict profiles. So even apart from the law, fake reviews are a poor bet.

How to grow reviews the right way

• Ask every customer, at the same point in the process, with the same message.
• Send a direct link to your review page by text or email after the job.
• Never suggest what to write or which star rating to give.
• Reply to every review, positive and negative, briefly and politely.
• If you show reviews on your website, show them fairly, with a link to the source.

Automating this ask through your CRM makes it consistent and removes the temptation to cherry-pick. My guide on how to get more Google reviews the right way goes deeper.

Drip pricing: advertised prices must be real

Drip pricing means showing an attractive price and adding mandatory fees at checkout or on the invoice: booking fees, service fees, "admin" fees, mandatory cleaning fees, required delivery charges. Since amendments in 2022, the Act explicitly says that advertising a price that is not attainable because of added fixed mandatory charges is a misleading representation.

Practical rules of thumb:

• If every customer must pay a fee, include it in the advertised price.
• Taxes imposed by law on the purchaser, such as GST/HST and provincial sales tax, can be added separately.
• Optional extras can be shown separately, if they really are optional.
• "From" prices should be prices customers can actually get, for a service that exists.

The Bureau has acted against large companies in sectors such as car rentals, ticketing and food delivery over drip pricing. Small businesses get less attention, but the same rules apply.

Provincial laws matter too. Quebec's Consumer Protection Act, for example, has strict rules on advertised prices including all charges except certain taxes. Ontario and other provinces have their own consumer protection statutes.

"Regular price" and "was/now" claims

If you advertise a sale with a comparison price ("Regular $199, now $149"), the Act's rules on ordinary selling price apply. Generally, the regular price must be one at which a substantial volume of the product was sold, or at which it was offered in good faith for a substantial period, within a reasonable time before or after the claim. Inflating a "regular" price to make a sale look bigger is a classic deceptive practice.

The same logic applies to "limited stock" or countdown timers: if the urgency is fake, the claim can mislead.

Other claims to handle carefully

• "Best", "#1", "top-rated": be ready to show what it is based on.
• Environmental claims: recent amendments require claims about environmental benefits to be supported by adequate and proper testing or substantiation.
• Before-and-after photos: must be genuine and representative.
• "Free": should be genuinely free, without hidden conditions.
• Testimonials: real customers, real words, typical results or clear statements if they are not typical.

A 10-point checklist before you publish an ad

1. Is the price the full price, apart from taxes?
2. Is every mandatory fee included?
3. Is any "regular" or comparison price genuine?
4. Can you back up every superlative?
5. Are reviews and ratings you show real and fairly selected?
6. Are any incentivized reviews disclosed?
7. Do photos represent what customers actually get?
8. Does the landing page match the ad's promise? (More on that in landing pages for Google Ads that convert.)
9. Are conditions and exclusions clear, not buried?
10. Would a reasonable customer feel misled after buying?

How I work on this

In the ads I run, prices and claims are checked against the landing page, and reviews come only from real customers through automated, consistent requests. If your Google Ads or Meta campaigns use pricing claims, I review them as part of a Google Ads audit. For the broader legal side, I recommend a lawyer; my role is to make sure the marketing you run is honest and consistent across ads, website and profiles.