On June 20, 2011, the Consumer Product Safety Act (the
"Act") became law. It significantly increased the
obligations on companies all along the supply chain of consumer
products. It imposes a new set of broad restrictions, recordkeeping
requirements and stringent reporting obligations for companies
which manufacture, import, distribute, sell, advertise or test
consumer products in Canada. Consumer products include any product
and its parts or accessories which can reasonably be expected to be
used by an individual for non-commercial purposes. The government
has sweeping new powers to enforce these restrictions and
requirements and dole out potentially severe penalties for
While the new rules have a huge impact throughout the supply
chain, importers may feel the effects the most as they have
historically been less exposed to liability for product safety than
others because of their role as intermediary.
The Act prohibits companies from advertising, selling or
distributing consumer products they know pose an unreasonable
danger to human health or safety, or that have been recalled. This
includes products that are labelled in a way that may be misleading
about their safety. Additionally, certain products are prohibited
entirely or must meet certain requirements set out in the
It appears that manufacturers and importers have an increased
burden under the Act. They are prohibited from manufacturing,
importing, advertising, selling or distributing products that pose
an unreasonable danger to human health or safety whether or not
they know of the danger.
In addition to the restrictions, companies must report all the
information they have about product recalls and occurrences,
defects, characteristics or labelling deficiencies that may
reasonably be expected to result in an individual's death or
serious adverse impact on their health anywhere in the world.
Reports have to be made within 2 days of learning about the problem
with the product. Manufacturers and importers must make a more
detailed report within 10 days of learning of the problem. In order
to enforce these restrictions and requirements, the government has
sweeping new powers, including:
ordering that manufacturers and importers test and study their
products at the company's own expense;
ordering the immediate recall of products;
very broad search and seizure powers;
The penalties for non-compliance with the Act can be severe. In
most cases, non-compliance can result in a 2 year prison sentence
and a fine of $5,000,000. For some offences, there is no maximum
fine and the maximum prison sentence is 5 years.
Therefore, it is important for companies throughout the supply
chain to review their products, labelling and advertising to ensure
they are in compliance with the Act and Regulations. They must also
ensure that they set up systems for immediately evaluating and
reporting complaints or other information received about adverse
health impacts resulting from the use of their products. This may
require working with other companies along the supply chain to
ensure compliance. Additionally, companies may need to revisit and
rewrite contracts with the restrictions and requirements of these
new rules in mind.
In Irwin v. Alberta Veterinary Medical Association, 2015 ABCA 396, the Alberta Court of Appeal found that the "ABVMA" failed to afford procedural fairness to a veterinarian undergoing an incapacity assessment.
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