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Consumers Need to be Wary of International Online Transactions

OTTAWA, April 2, 2014–Canadian online consumers have no clear recourse when encountering a problem involving international retailers, according to a report released today by the Public Interest Advocacy Centre (PIAC) entitled, “Shopping for Consumer Protection: Current Jurisdictional Issues.” The report recommends governmental bodies consider providing recommended venues for online dispute resolution (ODR) to provide predictability in the marketplace for both consumers and vendors.

The report examined challenges facing consumers when experiencing online shopping disputes with retailers based outside of Canada. “The murky world of trans-border consumer disputes remains a haunted house for consumers, with methods to legally resolve disputes remaining unclear,” noted John Lawford, PIAC’s Executive Director and General Counsel. Lawford concluded, “Currently consumers purchasing goods from jurisdictions outside of Canada have a limited number of avenues available to them should a dispute arise with an online retailer.”

While the report revealed that 72% of 1,001 Canadian consumers surveyed have never experienced a problem purchasing online, it found when Canadians did encounter a problem, ¾ of the time the retailer was foreign-based. In addition, 78% of Canadian consumers surveyed were not confident they could resolve a dispute with a foreign-based online retailer, versus 10% if the retailer is based in their home province. Other survey results found in the report include:

• 27% of Canadian consumers surveyed buy online at least once a month
• 74% of Canadian consumers surveyed look at products online at least once a month
• While 62% of Canadian consumers surveyed always look to ensure the retailer’s payment system is secure, only 20% always review the retailer’s compliant handling process.
• 45% of Canadian consumers surveyed do not know which laws should apply if they encounter a problem with an online retailer located outside of Canada.

The report recommends consumer protection agencies and organizations continue making consumers aware of potential hazards when purchasing from online retailers outside of Canada. Current government awareness programs dealing with online privacy should appear alongside this information to provide consumers with greater clarity before a consumer commits to an ecommerce purchase. Other recommendations include the provision of consumer assistance resources by provincial consumer protection agencies and consumer complaint bodies at all levels of government.

The report also calls for online retailers to use complaint, feedback and dispute information to update and enhance their own operations. “Clearly setting out policies and practices to address dispute resolution is essential to improving the online shopping experience for both consumers and retailers,” said Jonathan Bishop, PIAC’s Research Analyst.

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

Download File: shopping_for_consumer_protection.pdf   [size: 0.32 mb]

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

thumb_pdfDownload File: shopping_for_consumer_protection_fr.pdf [size: 0.38 mb]

The report, including the appendix, can be viewed at this link:

thumb_pdfDownload File: shopping_for_consumer_protection_w_appendix.pdf [size: 0.8 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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