FEDERAL COURT OF APPEAL DECISION IS A USEFUL REMINDER OF BASIC PRINCIPLES
On February 12, 2025 the Federal Court of Appeal (“FCA”) issued a decision upholding the Federal Court (“FC”) decision in Empire Company Limited and Sobeys Inc. v. the Attorney General of Canada (2025 FCA 34). The case dealt with an application for judicial review of a decision of the Commissioner of Competition to commence an inquiry under the Competition Act (the “Act”, the same legislation which defines permissible multi-level marketing plans and illegal pyramid selling schemes in Canada).
Accordingly, the case serves as a reminder of several principles regarding the Competition Bureau that are relevant to direct selling companies.
The new year brings possible new tax reporting requirements for direct sales platform operators (“Direct Sellers”)!
These changes stem from amendments to the Income Tax Act (“ITA”) and mandate that digital platform operators throughout the online “gig” economy report income and certain other information about some of the sellers using their websites or apps to the Canada Revenue Agency (the “CRA”). See our prior article for more technical information.
Those affected include certain Direct Sellers operating on a “buy-resale” model. Filings for the 2024 year are due by January 31, 2025!
As we have blogged about here, in the world of “natural health products” (“NHPs”), the ability to import unlicensed products into Canada for personal use — colloquially known in the industry as “Not for Resale” (“NFR”) — is a hot topic for direct sellers. Businesses need to understand the specific and narrow administrative policies which allow for these importations, so they do not draw the ire, and enforcement actions, of Health Canada!
Canada Border Services Agency (“CBSA”) has announced that the final iteration of its recent revamping of Canada’s import systems will arrive May 13, 2024.
Direct Sellers importing their products into Canada for further distribution or sale to their salesforce or customers (including with the assistance of a customs broker) – will be particularly concerned with these changes!
