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Canadian Consumers Need More Protection Dealing with “Free” Services

OTTAWA, March 26, 2014–Canadian consumers have little protection should they encounter a problem or become involved in a dispute with online free service providers, according to a report released today by the Public Interest Advocacy Centre (PIAC) entitled, No Such Thing as a Free Lunch: Consumer Contracts and “Free” Services. The report points to the growing the disparity of interests between companies offering free services and consumers when companies seek methods to monetize their “free” businesses, ultimately consumers stand to lose.

“Current legislative and regulatory regimes fail to provide sufficient protection to Canadians using free online services,” noted John Lawford, PIAC’s Executive Director & General Counsel. Lawford continued, “Consumers shouldn’t have to gamble with their privacy each time they wish to send an email, connect with family or use an online storage solution.”

The report recommends an update to current provincial consumer protection laws so they apply to those accessing free services online that monetize user-provided value. The report also cited the need for amendments to the Personal Information Protection and Electronic Documents Act (PIPEDA) allowing the Office of the Privacy Commissioner the ability to investigate and enforce elements of Canada’s privacy regime through fines or mandatory orders. “As the potential for conflict between consumer and corporate interests grows, it is time to provide the Office of the Privacy Commissioner of Canada the necessary tools to protect Canadians using online services,” noted Jonathan Bishop, PIAC’s Research Analyst.

The report also called for a statutory breach of confidence tort allowing a user to make a claim against web companies that unnecessarily use private information gathered on their website. In addition, the report recommends creation of methods for assessing market power from a competition law perspective that can be applied to the online free services sector.

To see the full report, please consult the following link:

 

thumb_pdfNo Such Thing as a Free Lunch: Consumer Contracts and “Free” Services.
Download File: free_services.pdf [size: 0.61 mb]

 

To view the report in French, please consult the following link:

thumb_pdfUn repas gratuit, ça n’existe pas : Les contrats de consommation et les services « gratuits »
Download File: free_services_fin_fr.pdf [size: 0.75 mb]

PIAC received funding from Industry Canada’s Contributions Program for Non-Profit Consumer and Voluntary Organizations to prepare the report. The views expressed in the report are not necessarily those of Industry Canada or the Government of Canada.

For more information please contact:

John Lawford
Executive Director & General Counsel
Public Interest Advocacy Centre (PIAC)
(613) 562-4002×25
Mobile (613)447-8125
lawford@piac.ca
www.piac.ca

Jonathan Bishop
Research & Parliamentary Analyst
Public Interest Advocacy Centre (PIAC)
(613) 562-4002×23
jbishop@piac.ca
www.piac.ca

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