Sears Fined in Deceptive Tire Marketing Case

The Government of Canada’s Competition Bureau has announced that Sears Canada Inc. has been ordered to pay a $100,000 administrative monetary penalty as well as $387,000 towards the Competition Bureau’s legal costs, for a total of $487,000, under the Competition Act’s Deceptive Marketing Practices provisions.

The order followed the Competition Tribunal’s January decision that Sears breached the Act by making false or misleading representations regarding savings available to consumers when they advertised discounts on certain tires across Canada. The Tribunal’s order also prohibits the automotive business division of Sears from engaging in similar representations for a period of 10 years.

Sears agreed to pay the $100,000 administrative monetary penalty and costs in a joint submission to the Competition Tribunal, the maximum penalty that can be imposed on a corporation following an initial finding of reviewable conduct. Parliament is currently considering amendments to the Act which would significantly increase such penalties to better deter similar deceptive marketing practices.

“This kind of deceptive marketing practice hurts consumers, business competitors and competition,” said Raymond Pierce, Deputy Commissioner of Competition. “Consumers deserve the truth about prices advertised by retailers.”

The Competition Bureau is an independent law enforcement agency that oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.