Competition Bureau Actively Preventing Deceptive "Sales Prices" in the Jewellery Industry

OTTAWA, April 24, 2003 — The Competition Bureau announced today that it has settled a case involving The Gold Factory and R. Pye & Sons Jewellers, in St. John's, Newfoundland. A consent agreement filed by the Bureau with the Competition Tribunal requires that the corporation and officers operating the jewellery retail chains refrain from using deceptive pricing practices in promoting jewellery sales.

It is a violation of the ordinary price provisions of the Competition Act for retailers to make "regular price" claims without selling a substantial volume of the product, or offering the product, at that price or a higher price within a reasonable amount of time. A Bureau investigation revealed that the jewellery retailers misrepresented the value of savings to consumers by continuously offering significant discounts from their inflated regular prices of gold jewellery.

Under the terms of the consent agreement, which will remain in effect for 10 years, the officers of the corporations have agreed to cease making any written or verbal representations relating to the regular selling price of products unless:

• 50% of the products had been sold at the stated regular price within 12 months prior to the making of the representation; and
• the products were offered for sale at the stated price or a higher price within 12 months prior to the making of the representation.

"The Bureau is committed to ensuring that consumers get the fair and accurate information they need to make informed purchasing decisions when they are shopping," said Raymond Pierce, Deputy Commissioner, Competition Bureau.

This is the second time since December 2002 that the Bureau has been successful in clamping down on jewellery retailers who have violated the ordinary price provisions of the Competition Act. On December 20, 2002, the Bureau filed a consent agreement with the Tribunal, requiring the corporations and officers operating Ontario-based retail chains Fine Gold Jewellers and The Diamond Co. to refrain from using deceptive pricing practices in promoting jewellery sales.

The Competition Bureau is an independent law enforcement agency that promotes and maintains fair competition so that all Canadians can benefit from competitive prices, product choice and quality service. It oversees the application of the Competition Act, the Consumer Packaging and Labelling Act, the Textile Labelling Act and the Precious Metals Marking Act.

For media enquiries, please contact:
Maureen McGrath
Senior Communications Advisor
Communications Branch
819-953-8982, or 613-296-2187 (cell)

For general enquiries, please contact:
Information Centre
Competition Bureau
1-800-348-5358