CFIA Reports Increase in Complaints Regarding Mislabelled Products of Canada

The Canadian Food Inspection Agency has reported a rise in complaints regarding products mislabelled as being from Canada or lacking information about their country of origin.

The governing body responsible for enforcing food labelling standards stated in an email to The Canadian Press that the surge in complaints occurred in recent months as Canadians showed increased support for local businesses to counter potential tariffs from the U.S.

The CFIA is currently examining the complaints related to these labels and has stated that it is too early to determine if there has been any non-compliance.

This increase in complaints did not come as a surprise to Julia Kappler, a partner at law firm Gowling WLG in Montreal, who noted that the Canadian origin of a product has become a significant selling point in the current political climate.

Kappler mentioned that people are now paying closer attention to product origin claims, leading to more complaints being lodged if consumers feel the origin information is unclear or inaccurate.

Meeting the product of Canada designation can be challenging for companies as it entails strict criteria. According to the CFIA, a product must have all or most of its food, processing, and labor sourced from Canada to be considered a product of Canada.

While there may be cases where some components or ingredients are Canadian, other countries may have also contributed, explained Kappler.

Although complaints have focused on product of Canada labels, the CFIA noted that other terms used on domestic items have not sparked similar reactions.

No complaints have been received regarding manufacturers misrepresenting their products as made in Canada or falsely claiming they are 100% Canadian.

A made in Canada label can only be used if the final significant transformation of the product occurred in Canada, such as when imported ingredients are processed into a product in Canada.

For a claim of 100% Canadian, the item must consist entirely of Canadian ingredients, processing, and labor.

The Competition Bureau oversees the usage of these terms for non-food items.

The product of Canada label is permitted on non-food items only if at least 98% of the production or manufacturing costs were incurred domestically. Items labeled as made in Canada must have at least 51% of their production costs from the country.

Every year, the Competition Bureau receives numerous complaints related to labelling, as stated by senior communications advisor Marianne Blondin in a late February email.

If the CFIA deems the complaints valid, Dara Jospé, a partner at Fasken Martineau DuMoulin LLP in Montreal, mentioned that the agency can enforce actions such as halting sales of the items, recalling them, or imposing penalties for non-compliance.

In cases of misleading labels that do not impact safety, Jospé believes the CFIA might allow the manufacturer to sell existing stock within a reasonable timeframe.

However, due to the significance of Canadian claims to consumers, the agency might react more decisively and promptly.

Jospé stated that the CFIA may require an immediate recall and cessation of the claims in such instances.

Penalties under the Food and Drugs Act can amount to $250,000 in fines and up to three years of imprisonment, Kappler noted.

Under the Competition Act, which applies to non-food items, misuse of Canadian labels can result in fines equal to the greater of $10 million, three times the benefits obtained from the conduct, or three percent of the corporation’s annual global revenue if the exact amount cannot be determined.

Kappler emphasized the importance of ensuring compliance with these claims before marketing products, as dealing with repercussions later could be more challenging for businesses.