Comics News
Diamond Comics POS System May Be Illegal In Canada
By Hervé St-Louis February 15, 2009 - 08:29
Since January 2008, Diamond Comics, the largest comic
book distributor in North America has required that all products it distributes
include barcodes that can be scanned by its staff and by North American comic
book retailers. Diamond Comics has aggressively encouraged comic book retailers
to adopt its point of sale (POS) scanning technology. Many Canadian retailers have
adopted the scanning technology in their stores. However, many product vendors
have stopped including specific Canadian prices on their products. In turn,
Canadian retailers have begun using American prices on products ordered through
Diamond Comics. Many comic book retailers use Diamond Comics exclusively
as their distribution channel. Many stores now inform their customers that all prices
are quoted in US dollars and adjusted at the checkout point to match the
current Canadian/US dollar exchange rate.
However, subsections 74.01(2) and 74.01(3) of the
Competition Act of Canada require that all prices on products sold in Canadian
stores contain no “
false or misleading ordinary selling price representations.”
Based on this interpretation of the Competition Act, pricing products in US
dollars in Canadian stores might be illegal. Customers must know at all
times the exact price of a product located in a store. Because the Canadian
exchange rate changes daily, it is impossible for a customer to pick up a
product on a shelf and know in advance the price of the product before
purchasing it.
Moreover, several Canadian comic book stores do not put stickers or labels on products in their stores. They rely solely on product barcodes to determine the price of items.
Legal consequences for Canadian stores found guilty of false
or misleading ordinary selling price representations are devastating. According
to the Competition Bureau of Canada “
If a court determines that a person has
engaged in conduct contrary to subsection 74.01(2) or 74.01(3), it may order
the person not to engage in such conduct, to publish a corrective notice and/or
to pay an administrative monetary penalty of up to $50,000 in the case of a
first time occurrence by an individual and $100,000 in the case of a first time
occurrence by a corporation. For subsequent orders, the penalties increase to a
maximum of $100,000 in the case of an individual and $200,000 in the case of a
corporation.”
As it stands the majority of Canadian comic book stores
are open to complaints from consumers to the Competition Bureau of Canada for
false or misleading pricing. As the whole industry may be affected, there could
even be possibilities that class-action suits be launched by Canadian comic
book consumers or that the Competition Bureau of Canada investigates the
practices of all Canadian comic book stores and Diamond Comics and force the
industry to put fixed Canadian prices on all products.
It is important that Diamond Comics reinstates fixed Canadian
pricing on all products and that Canadian retailers label each of their products
in Canadian dollars. Canadians should not expect to purchase their
products in any other currency than their own, when shopping in Canada.