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Investigation Into Newspaper Promotional Campaign Concludes

FOR IMMEDIATE RELEASE

EDMONTON, June 29, 2001 – Alberta Government Services has wrapped up its investigation into allegations of negative option billing practices during a National Post promotional campaign. In an agreed resolution to the matter, the newspapers involved will offer refunds to consumers billed under the campaign. All parties have been cautioned that any similar campaigns would likely result in prosecutions under the Fair Trading Act.

"The newspapers cooperated fully with our investigation and acted immediately to halt the campaign and remedy the situation," said Government Services Minister David Coutts. "We are satisfied with the steps being taken to ensure consumers are not disadvantaged as a result of the promotion."

During the campaign, which ran between January and April 2001, Edmonton Journal and Calgary Herald subscribers were offered a combination subscription allowing them to receive the National Post along with their current paper. The combined rate equaled the existing subscription rate they were already paying.

After three months, subscribers who had agreed to the initial offer were informed by mail that they would be billed the full subscription rate for the National Post, while the rate for the Edmonton Journal and the Calgary Herald would remain the same. Subscribers were advised that both subscriptions would be paid for under their pre-authorized monthly payment plans.

Under the campaign, 291 Edmonton Journal subscribers and eight Calgary Herald subscribers were billed for the permanent price increase, beyond the trial period to which they initially agreed. The newspapers have since indicated the program will not continue and each subscriber that took part in the campaign will be offered a refund.

The Fair Trading Act specifies that companies cannot require consumers to pay for unordered goods or services unless the consumer agrees in writing to pay. In these types of circumstances, described as negative option sales, consumers should be aware they are not responsible for the costs of unsolicited items.

For more information on this legislation, a tipsheet called The Fair Trading Act: What’s new is available by calling the department’s Consumer Information Centre at 1-877-427-4088 or on Government Services’ web site at: http://www3.gov.ab.ca/gs/information/publications/tipsheets/.

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Shannon Larkins - Alberta Government Services - (780) 415-6051