Canadian Tire has been ordered to pay $1,287,550 in fines and costs after a Quebec Court judge approved a settlement resolving 74 charges of false advertising tied to inflated “regular” prices in the Montreal area. The decision closes a case stemming from a 2021 investigation by provincial regulators and marks one of the larger penalties imposed in a deceptive pricing matter in Quebec.
The Canadian Tire false advertising case centres on allegations that certain products were promoted with reference prices that did not reflect actual selling practices. Regulators concluded that the discounts advertised to consumers were based on inflated regular prices that were rarely, if ever, used in the market.
Judge Simon Lavoie of the Court of Quebec in Montreal ratified the agreement between Canadian Tire and the prosecution, setting total fines and costs at just under $1.3 million. The penalties range from $15,625 to $18,150 per count across 74 offences.
The charges were laid under Quebec’s Consumer Protection Act after a six month investigation conducted in 2021 by the Office de la protection du consommateur, commonly known as the OPC. The agency is responsible for enforcing consumer protection rules across the province.
Canadian Tire initially entered a not guilty plea, a step that Crown prosecutor Jérôme Dussault described as the company’s legitimate right before negotiations began. Discussions between the parties led to a joint submission outlining the number of counts, the fine range per count, and the total amount. Judge Lavoie accepted that submission.
Under the terms of the agreement, Canadian Tire has 12 months to pay the full amount.
Investigation Focused on Inflated Reference Prices
The Canadian Tire false advertising case focused on how the retailer presented regular or reference prices in flyers, on its website, and on in store displays. The OPC found that some of those reference prices were artificially inflated, which made advertised discounts appear more substantial than they actually were.
According to the regulator’s analysis of sales data, the products in question were rarely sold at the alleged regular price online and were practically never displayed at that price in stores during the investigation period. Authorities concluded that the supposed regular price effectively did not exist in the market, making the advertised discount misleading.
OPC spokesperson Charles Tanguay explained that the agency demonstrated the reference prices were inflated, which misrepresented the actual discount available to consumers. From the regulator’s perspective, the issue was not that customers paid more than the advertised sale price, but that they were led to believe they were receiving a larger discount than was truly available.
The OPC said such practices undermine consumer trust and contravene Quebec’s strict rules on the use of regular or reference prices in advertising.
Scope of the 2021 Investigation
The investigation covered the period from April to October 2021 and examined price representations across Canadian Tire flyers, its website, and three stores in the greater Montreal area.
Seven products were initially targeted, with regulators tracking their pricing across different channels and locations. Under the settlement, Canadian Tire admitted guilt for five of the seven products investigated. These included Henckels knife sets, Cuisinart knife sets, Lagostina cookware sets, Heritage cookware sets, and a DeWalt cordless drill.
Three specific stores were part of the original investigation but were later removed from the case during negotiations for confidential reasons. Responsibility for the offences ultimately rested with the corporate entity.
Legal Framework Under Quebec Consumer Protection Law
The charges were laid under section 225(b) of Quebec’s Consumer Protection Act, which prohibits merchants from falsely indicating a regular price or other reference price for goods. The provision is designed to prevent retailers from using unrealistic or seldom used reference prices to create the illusion of large discounts.
In the Canadian Tire false advertising case, the total fines and costs reached $1,287,550 across 74 counts. The amount has been described in some commentary as a record level penalty following an OPC pricing investigation.
The case also highlights the investigative approach used by Quebec authorities. Regulators combined documentary evidence from flyers, websites, and in store signage with detailed sales data analysis to demonstrate that the reference prices were not genuine market prices.
Company Response and Position
Canadian Tire acknowledged responsibility for the five specified products and the 74 counts tied to the 2021 investigation period. The company has emphasized in public statements that, in its view, no customers were overcharged on the items in question. The issue, it said, related to how discounts were represented relative to the referenced regular prices.
The retailer has also characterized the violations as relating to a limited set of products over a defined six month window several years ago. From the company’s perspective, the matter is now resolved and closed.
Implications for Retail Pricing Practices
The Canadian Tire false advertising case underscores the strict approach Quebec regulators take toward reference pricing. Retailers operating in the province must ensure that any regular price used in advertising reflects a genuine selling price supported by actual sales history and in store display practices.
The case also signals to national chains that regulators are willing to scrutinize historical pricing data when evaluating whether advertised discounts are truthful. For large retailers and franchise systems, the outcome reinforces the need for strong compliance controls over how promotional and regular prices are set and communicated across flyers, e commerce channels, and physical stores.
