Bringing competing values in consumer protection into focus

The Competition Bureau recently brought into focus ongoing regulatory barriers to online sales of prescription eyewear. The Competition Bureau’s advocacy comes in the middle of a dispute between Ontario self-regulatory bodies and a major player in the online sale of prescription eyewear. An appeal from a decision finding online sales violated Ontario’s Regulated Health Professions Act is pending before the Ontario Court of Appeal. At stake is whether non-Ontario companies operating online need to comply with Ontario regulations governing the provision of healthcare in Ontario.

Competition Bureau calls for change

In a recent article in the Competition Bureau’s Advocate, the Competition Bureau took aim at regulations that limit the ability of consumers to purchase prescription eyewear online. The Competition Bureau asserted that online purchasing led to less-expensive and more convenient options than in-store sales. The Competition Bureau questioned whether Ontario regulations that require licensed physicians, optometrists and opticians to prepare, adapt and deliver prescription eyewear were too restrictive.

The Competition Bureau agreed that regulated health professionals had an important role to play but questioned whether the regulations were narrowly directed to preventing harm to consumers.

However, decision-makers should consider whether it is strictly necessary for licenced professionals to be involved in all aspects of the eyewear dispensing process (i.e. preparation, adaptation and delivery), and to what degree.

The Essilor Case

The timing of the Competition Bureau’s advocacy suggests that it may be intending to influence an issue that is before the Ontario Court of Appeal.

In College of Optometrists of Ontario et al v. Essilor Group Canada Inc., the self-regulatory bodies for Optometrists and Opticians successfully challenged whether online sales by the Essilor Group are permitted under Ontario’s regulations.

The Ontario Superior Court of Justice held that online sales by Essilor were subject to Ontario regulations that restricted who could dispense eyewear. The court held that the activities of Essilor in making eyeglasses, filling prescriptions and delivering eyeglasses involved “dispensing” of eyeglasses within the meaning of the Regulated Health Professions Act. The court then needed to decide whether the Ontario legislation applied to Essilor given that Essilor was based in British Columbia and sold the eyeglasses over the Internet. Although the court accepted that most of the activities at issue occurred outside of Ontario, the court nevertheless held that the Ontario law applied because there was a sufficient connection between the activities of Essilor and Ontario.

In this case prescription eyewear is ordered by people in Ontario. It is delivered to them in Ontario. Presumably it is to be used by them while resident in Ontario. This represents a sufficient connection to Ontario. To find otherwise would mean the eyeglasses are provided without obligation to adhere to Ontario regulation. Ordering eyeglasses is the catalyst for, and delivery is part of, dispensing the eyewear; indicating that it is at least part of a “controlled act” as defined in s. 27(2) of the Regulated Health Professions Act.

Appeal Pending

Essilor has appealed the Ontario Superior Court of Justice’s ruling. The Ontario Court of Appeal granted a stay of the Superior Court decision pending the hearing of the appeal in May 2018. The case remains under reserve by the Ontario Court of Appeal.

Interested? Read more!

College of Optometrists of Ontario et al v. Essilor Group Canada Inc.

Competition Bureau encourages online competition in the eyewear industry

College of Optometrists response to Competition Bureau

Food Truck Wars at the Competition Bureau

Are the folks over at Canada’s Competition Bureau unhappy with their choices of local restaurants? Possibly – they sure do take a swipe at their host (the City of Gatineau, Quebec) in a recent report on food trucks. What is clear is that they want Canadian municipalities to review their mobile food regulations (a.k.a. food truck licensing and operation restrictions).

The Competition Bureau states that the Bureau “found no clear evidence that shows detrimental impacts of mobile food services on restaurants.” Instead, they state that these are ”two different business models with different levels of investments and services.”

The Bureau would like to see municipalities: consider:

  • Abandoning the use of selection committees to determine what food trucks operate.
  • Reconsidering whether operating hours are in place for legitimate reasons.
  • Reducing or repealing proximity requirements to prevent food trucks being operate in close proximity to a brick and mortar restaurant.
  • Limiting restricted zones to situations in which there are legitimate traffic management concerns.

Interestingly, the Competition Bureau does not analyze the issue of the use of public spaces for commercial gain and, therefore, the legitimate interest of municipalities in regulating that space. In simply stating that these are different business models, the Competition Bureau failed to engage directly with the complaint by brick-and-mortar restaurants that they have to pay for their space in premium locations whereas food trucks can occupy that space for relatively minimal licensing fees.  The failure to think deeply about this issue is a significant blind spot undermining the Bureau’s analysis.

Will municipalities tell the Competition Bureau to butt-out? Probably. The jurisdiction of the Competition Bureau does not include supervising the public policy decisions made by City Councillors. But if food truck operators wanted to challenge city bylaws, the Competition Bureau has lent a helping hand with a road-map for an argument.

Read the Competition Bureau Report here.

Influencer Disclosures on Instagram

Using online influencers can be a compelling marketing strategy for many companies. However, social posts contain product or services endorsements fall squarely within the endorsement guidelines issued by the U.S. Federal Trade Commission and the Canadian Competition Bureau, which require the relationship between the influence and the company to be clearly disclosed. Those endorsement guidelines place the risk of non-compliance squarely on the company whose products or services are being endorsed. Recently, Instagram announced a new tool to make compliance easier. Influencer posts on Instgram will be tagged “Paid partnership with”. Instragam states that when the influencer and the company use this tag “they will both have access to Insights to track exactly how their branded content posts and stories are performing.”

Check out the Instagram announcement here.