5.3 Regulatory Laws

While there are situations in which we expect individuals to act according to higher moral laws, at a basic level we always expect business professionals to follow the law. Virtually every marketing activity has legal and ethical implications. Canadian laws fall across multiple jurisdictions—Federal (national), Provincial, and even Municipal. Canadian companies operating internationally must also consider the legal requirements of the country of their customers, especially in the digital space where cross-border enforcement is increasingly common.

The majority of businesses rely on compliance of these laws and standards through self-regulatory organizations such as the Canadian Marketing Association (CMA), Advertising Standards Canada (ASC), or the Canadian Association of Broadcasters (CAB). To join each body, your business must comply with both the laws and demonstrate ethical behaviour.

Privacy Laws and Data Protection

Privacy law is one of the fastest-evolving areas affecting marketers. Canada’s current Personal Information Protection and Electronic Documents Act (PIPEDA) has been under reform, with the proposed Consumer Privacy Protection Act (CPPA) under Bill C-27 expected to modernize privacy rules and bring them closer to Europe’s General Data Protection Regulation (GDPR). Provinces such as Quebec have already advanced further; Quebec’s Law 25 (formerly Bill 64) introduces stricter consent requirements, mandatory breach reporting, and higher penalties.

For marketers, this means transparency and accountability are non-negotiable. Consent for data use must be meaningful, opt-outs must be easy, and privacy by design is becoming an industry standard. Failing to comply risks fines, reputational damage, and loss of consumer trust.

Product Liability in a Digital Age

Traditionally, product liability laws focused on physical goods—ensuring products are safe for use and that companies are accountable for harm. Today, liability increasingly extends into digital and algorithmic domains. Marketing that relies on AI-driven personalization, chatbots, or recommendation engines could expose companies to claims if those systems mislead or discriminate.

Marketers must therefore monitor and test automated tools for unintended consequences and be ready to demonstrate human oversight and fairness in how products or services are promoted.

Fraud in the Marketing Process

Fraud remains a critical area of concern. Beyond classic deceptive practices, digital marketing has introduced new forms such as:

• Click fraud and ad impression fraud in programmatic advertising.

• Fake reviews and testimonials, often spread through online marketplaces.

• Influencer fraud, where partnerships are not disclosed, violating FTC and ASC endorsement guidelines.

These practices undermine trust and are increasingly targeted by regulators and platforms alike. Marketers must vet their partners, disclose sponsorships, and implement tools to detect and prevent fraudulent activity.

Environmental Marketing and Greenwashing

Society expects businesses to reduce environmental harm, and many brands have embraced sustainability messaging. However, vague or misleading claims—known as greenwashing—carry both reputational and legal risks. In 2022, Canada’s Competition Bureau fined Keurig for misleading claims about the recyclability of its coffee pods.

Marketers must substantiate environmental claims with clear, verifiable evidence and avoid overpromising. “Eco-friendly” is no longer sufficient without proof.

Global Standards and International Trade

As Canada participates in numerous trade agreements, its federal laws often need to align with higher international standards. For example, Europe’s GDPR has set a global benchmark for digital privacy, while the EU’s Digital Services Act and Digital Markets Act add stricter requirements for online platforms. In the United States, the Federal Trade Commission (FTC) continues to update its endorsement guidelines to address influencers, online advertising, and dark patterns.

For Canadian marketers, this means compliance is not just domestic—it requires awareness of international laws and the ability to adapt campaigns across borders.

Categories of Protection

Most of the laws that impact marketers fall into three categories:

• Businesses need protection from other businesses. Competition laws address fairness and pricing.

• Consumers need protection from businesses. Consumer protection laws safeguard rights and create a fair marketplace.

• Society needs protection from businesses. Social costs and externalities created by business practices must be regulated.

Summary Table: Key Marketing Laws and Their Impact

Summary Table: Society Protection Laws and Marketing Impact

Historical Context

Historically, consumer protection laws in Canada gained traction in 1967 with the creation of the Department of Consumer and Corporate Affairs (CCA), establishing Canada as a world leader at the time. Today, consumer protection has evolved under the Department of Innovation, Science and Economic Development, but some argue Canada’s leadership role has diminished, shifting toward a reactive approach. Jenkin, M. (2018, June 05). The steady decline of consumer protection in Canada. Policy Options. https://policyoptions.irpp.org/magazines/june-2018/the-steady-decline-of-consumer-protection-in-canada/[/footnote]

The U.S. offers its own parallel history, from Upton Sinclair’s exposé on meatpacking in 1905 (leading to the FDA) to Ralph Nader’s automobile safety campaigns in the 1960s (leading to the National Highway Traffic Safety Administration). Canada’s Motor Vehicle Safety Act serves a similar role. Insurance Institute for Highway Safety, Highway Loss Data Institute. (2021, March). Fatality Facts 2019 Yearly snapshot. https://www.iihs.org/topics/fatality-statistics/detail/yearly-snapshot[/footnote]

Creation note: This content was updated with the assistance of ChatGPT, a language model developed by OpenAI, and was subsequently reviewed and edited by the author for clarity and accuracy.