Negative Option Marketing
There are laws in Manitoba to protect consumers against negative option marketing schemes. This is to prevent consumers from feeling trapped or tricked into paying for something that they did not ask for.
This page provides information on the legislation in the form of frequently asked questions:
What is negative option marketing?
Negative option marketing occurs when a supplier, such as a business:
- provides a consumer with goods or services - including an enhancement to a service that the consumer is already receiving - that the consumer did not ask for and;
- requires a consumer to pay for the goods or services unless the consumer informs the supplier that the consumer does not want them.
What are some examples of negative option marketing schemes?
Some examples of negative option marketing schemes are:
Example 1: A consumer signs up for a fixed term membership and before the contract’s expiry date they receive a notice stating the membership will be automatically renewed unless they contact the business.
Example 2: A consumer, at the end of a free or introductory trial offer, continues to receive goods or services and:
- is told by the business that they are automatically enrolled as a member
- is told by the business that they have entered into a contract and are then sent an invoice
- the supplier debits their credit card or bank account for the goods or services.
If all or any of above situations occurs, it is a negative option marketing scheme.
Example 3: A consumer is sent goods without having requested them from a supplier.
What if a supplier requires me to opt out of purchasing a good or service that I did not request and I fail to do so?
If a supplier requires you to opt out of purchasing a good or service that you did not request and you fail to do so, your inaction does not mean you consented to the purchase. You are not legally responsible or liable for any good or service received under negative option marketing.
What happens if I am a victim of a negative option marketing scheme?
If you are the victim of a negative option marketing scheme you are not liable to pay for any goods or services that you receive under the negative option marketing scheme.
What happens if I do pay for goods or services that were supplied using negative option marketing?
If you pay for goods or services that were supplied using negative option marketing, and you have not written to the supplier stating that you intend to accept the goods or services, you have up to one year to demand a refund.
If I demand a refund of monies paid for goods and services that were supplied using negative option marketing, how long does the business have to reimburse me my funds?
If you demand a refund of monies paid for goods and services that were supplied using negative option marketing, the supplier must refund your money within 30 days after receiving your request for reimbursement.
What should I do if a business refuses to refund me monies paid for goods or services supplied under negative option marketing?
If a business refuses to refund you monies paid for goods or services supplied under negative option marketing, contact the Consumer Protection Office at 204-945-3800 or toll-free within Manitoba at 1-800-782-0067 for assistance.
What are some situations when negative option marketing does not occur?
Negative option marketing does not occur if:
- You have entered into a written contract and are being periodically supplied with goods or services and a change to the good or service is not a material one. A material change is a change that is significant enough to influence your decision as to whether to enter into the agreement for the supply of the goods or services.
- You have entered into a written contract that provides for periodic supply of a good or service without further solicitation, and that contract sets out — prominently, and in clear and understandable manner — that the goods or services will be supplied periodically without further solicitation.
- You know or ought to know that the goods or services were intended for delivery to someone else.
If I am currently receiving a good or service under a one-year written contract that provides for the periodic supply of that good or service and my contract expires but the supplier continues to provide me with the same good or service without soliciting me, is that negative option marketing?
No. If you are currently receiving a good or service under a written contract which clearly and prominently informed you that the good or service would continue to be supplied periodically without further solicitation of you by the business, it is not negative option marketing.
What if a supplier says that I consented to receive a good or a service when I did not?
If a supplier says that you consented to receive a good or a service when you did not, the supplier must produce evidence that establishes your consent.
What happens if a supplier does not comply with the negative option marketing legislation?
If a supplier does not comply with the negative option marketing legislation and is convicted for the offence, they are subject to the greater of a fine of not more than $300,000 or three times the amount they obtained as a result of negative option marketing. Or they could be imprisoned for not more than three years, or both.