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SOCI - Standing Committee

Social Affairs, Science and Technology


THE STANDING SENATE COMMITTEE ON SOCIAL AFFAIRS, SCIENCE AND TECHNOLOGY

EVIDENCE


OTTAWA, Thursday, November 21, 2024

The Standing Senate Committee on Social Affairs, Science and Technology met with videoconference this day at 11:28 a.m. [ET] to consider Bill C-252, An Act to amend the Food and Drugs Act (prohibition of food and beverage marketing directed at children).

Senator Rosemary Moodie (Chair) in the chair.

[English]

The Chair: Good morning. I call to order this meeting of the Standing Senate Committee on Social Affairs, Science and Technology. My name is Rosemary Moodie. I’m a senator from Ontario and the chair of this committee.

Before we begin, I would like to do a round table and have all senators introduce themselves.

Senator Bernard: Thank you, chair. I’m Wanda Thomas Bernard, senator from Nova Scotia, Mi’kmaq territory, and deputy chair of the committee. Welcome.

[Translation]

Senator Boudreau: Good morning. Victor Boudreau from New Brunswick.

[English]

Senator Osler: Flordeliz (Gigi) Osler, senator from Manitoba.

Senator Burey: Good morning, everyone. Sharon Burey, senator for Ontario.

[Translation]

Senator Cormier: Good morning. René Cormier from New Brunswick.

Senator Petitclerc: Good morning. Chantal Petitclerc from Quebec.

[English]

Senator Seidman: Judith Seidman from Montreal, Quebec. Good morning.

[Translation]

Senator Mégie: Marie-Françoise Mégie from Quebec.

[English]

Senator Dasko: Donna Dasko, senator from Ontario.

The Chair: This morning, we are continuing our study on Bill C-252, An Act to amend the Food and Drugs Act (prohibition of food and beverage marketing directed at children).

Joining us today for the first panel, we welcome the following witnesses. Joining us in person from the Food, Health and Consumer Products of Canada, Michi Furuya Chang, Executive Vice President; and Pierre Savoie, Lawyer and Partner, LJT Lawyers. Joining us by video conference, from the Canadian Beverage Association, Mark Dekker, Senior Director, Science and Regulatory Affairs. Thank you all for joining us today.

First we will begin with opening remarks from Ms. Furuya Chang followed by Mr. Dekker. You will each have five minutes for opening statements. Ms. Furuya Chang, the floor is yours.

Michi Furuya Chang, Executive Vice President, Food, Health and Consumer Products of Canada: Good morning, honourable senators. My name is Michi Furuya Chang. I am Executive Vice President of Public Policy and Regulatory Affairs of Food, Health and Consumer Products of Canada, or FHCP. I am also a registered dietician.

Joining me today is Monsieur Pierre Savoie, Partner at LJT Avocats. He is a Quebec lawyer who specializes in advertising law and acted as a consultant for the drafting of the code we will be speaking about because of his experience with the Quebec model.

We’re very grateful to be in front of you today as you study Bill C-252. Thank you.

The Food, Health and Consumer Products of Canada, or FHCP, is the largest national industry association, representing Canada’s leading food, health and consumer product manufacturers. The FHCP helps the manufacturing sector protect the integrity and security of our product supply through evidence-based, growth-oriented policies that both support the growth of Canada’s economy, the sustainability of our health care system and the environment.

Let me first provide some background on how and why the Code for the Responsible Advertising of Food and Beverage Products to Children — which I will now refer to simply as “the code” — was developed.

While Bill C-252 may be well intentioned, FHCP strongly believes this legislation is not only unnecessary, but it focuses on a problem that has already been fixed. We do share a common objective with government in recognizing that children are a special audience for all advertising and have acted accordingly in developing the code because it was the right thing to do, though I do believe that we all agree that childhood obesity causes are complex and multi-factorial, as expressed by Dr. Sharma and Dr. Aziz in their testimony before the House of Commons Standing Committee on Health and this committee, respectively.

When listening to the committee’s proceedings of November 7, it struck me that the code was characterized as the “industry’s code.” I would argue that this characterization does a disservice to everyone involved. The code was the product of five years of leadership from industry associations, including FHCP, the Association of Canadian Advertisers, the Canadian Beverage Association and Restaurants Canada. We sought out Health Canada, health professionals and not-for-profit organizations and asked them for their input and feedback, and we included all of that feedback.

We have developed a code that covers advertising of foods that are high in sodium, sugar and saturated fat to children under 13 years of age. It represents a comprehensive and workable regime that applies to advertising in all media and meets or exceeds the guidelines in Health Canada’s very own 2018 guidance document and 2023 policy update.

The code is in action today. In 2023, we proceeded to implement the code, and it has been in action for 18 months. The code meets or exceeds Health Canada’s targeted approach to broadcasting and digital media. For example, the code goes further than media to restrict advertising in settings such as schools up to Grade 8 as well.

The code also incorporates the Quebec model and the criteria of Section 249 of Quebec’s Consumer Protection Act to determine whether an advertisement is primarily directed at children under 13 years of age. All criteria are evaluated by Ad Standards.

In spite of what you heard yesterday, I must emphasize that the code is mandatory, not voluntary. There is no opt-out mechanism, and it applies to all food and beverage companies in Canada, regardless of whether they are members of any of the associations named.

The code is administered by Ad Standards, an independent, not-for-profit organization that has a proven track record in dealing with ethical advertising, and is so trusted, that they review the Government of Canada’s own ads. Ad Standards Canada has implemented a robust and responsive consumer and advertiser pre-clearance and compliance system through reporting and administration of complaints and an enforcement regime. Pre-clearance provides certainty for advertisers and addresses concerns before they arise. None of this required government intervention, and none of the costs were passed on to taxpayers.

Honourable senators, why not give the code a chance for the next five years? It is mandatory, targeted to the intended audience and applies to all media. The code is already in place, and it is already working. If this is not sufficient, then we invite honourable senators to give serious consideration to incorporation by reference of the code to Bill C-252. Thank you.

The Chair: Thank you, Ms. Chang. Mr. Dekker, you have five minutes.

Mark Dekker, Senior Director, Science and Regulatory Affairs, Canadian Beverage Association: Thank you, Madam Chair, and thank you to the Senate Committee on Social Affairs, Science and Technology members for the opportunity to contribute to this critical discussion.

My name is Mark Dekker, and I lead the scientific and regulatory affairs team at the Canadian Beverage Association. For those who may not know, the Canadian Beverage Association, also known as CBA, is the trusted and leading voice for Canada’s sustainable, collaborative, responsible and competitive non-alcoholic beverage sector. Together, we represent over 60 brands of non-alcoholic products, including soda, juices, water and more.

Our sector contributes over $5 billion to Canada’s GDP and over 50,000 full-time-equivalent jobs across Canada. For every production dollar we earn, 88 cents is retained in the Canadian economy, supporting local businesses, hardworking families — the majority of which are middle class — and the communities where they live and work. CBA members are also committed to giving back by providing good-quality jobs, investing in sustainability initiatives and standing up for their neighbours with essential products in times of need.

The CBA has a long-standing commitment to social responsibility, particularly in marketing their products. Over the past five years, we have worked extensively with the government and a diverse group of stakeholders to develop and launch the Code for the Responsible Advertising of Food and Beverage Products to Children, also known as “the code” and “guide.”

The code and guide achieve the shared objective of a comprehensive and workable regime that applies to all advertising, including television and digital media. We believe that sector-wide adoption and compliance with the new code will reach the same policy outcomes that Bill C-252 and the presumed regulatory language to be proposed by Health Canada aim to achieve. These guidelines reflect the recognition of our unique responsibilities in the marketplace and our shared commitment to supporting children’s health and well-being.

Our industry is also working to empower Canadians, including parents, with tools and information to make informed choices about the beverages they consume. CBA members were among the first to adopt clear and easy-to-interpret front-of-pack calorie labelling. CBA members have reduced calories across beverage portfolios and expanded options like low- and no-sugar drinks, and the CBA collaborates with partners in public health agencies and partner associations to align our practices with Canadians’ evolving needs.

While we share the intended goal of the bill to ensure advertising is not directed to children, overly broad or unclear legislation will only cause undue regulatory burdens.

As of June 28, 2023, the code now delivers exactly what the government says it wants, a de facto mandatory requirement binding on all Canadian advertisers that will restrict child exposure to child-directed food advertising. Ad Standards Canada, a neutral third party and dedicated public service agency with deep expertise in advertising regulations, is administering the code.

CBA and its industry partners believe the code provides a comprehensive, mandatory and rigorous framework that achieves outcomes equivalent to the proposed regulatory amendments. At a time when food inflation continues to concern all Canadians, we respectfully urge the Senate Standing Committee on Social Affairs, Science and Technology to give this bill the thorough and complete study it needs. We hope you consider all aspects of this important area of concern before open-ended and unnecessary regulations are introduced.

In conclusion, the Canadian Beverage Association and its members are committed to working constructively with the government to support the health and well-being of children in Canada. We believe a collaborative approach rooted in shared responsibility and innovation can deliver meaningful outcomes while safeguarding choice, competition and local economies.

I hope today’s proceedings and the associated submissions have shown that, through this collaboration, our industry can take proactive measures to protect children.

Thank you for your attention, and I look forward to answering your questions.

The Chair: Thank you, Mr. Dekker. Thank you all for your opening remarks. We will now proceed to questions from committee members. For this panel, senators have four minutes for questions and the answers. Please indicate if your question is directed to a particular witness or witnesses and whom you would like to answer first.

The first question will be from Senator Bernard, deputy chair.

Senator Bernard: Thank you both for your testimony and for being here.

I’m going to go right to the chase. As you know, we heard self-regulation isn’t working and the code isn’t working. Two questions: One, were you consulted by the sponsor of this bill as it was being developed? Second, what is the evidence that you can present to our committee that the code is working the way you assert that it is?

Ms. Furuya Chang: Happy to begin. Thank you for the question, senator. I need to clarify right from the beginning that this code is mandatory. There have been a number of dispositions that have asserted that it is loose, it is a leaky sieve. It is mandatory. It covers all advertising, all advertisers.

If you actually look at the details of the code — and I would invite and encourage you to do so — it is actually based on Health Canada’s 2018 guidance document as well as their 2023 policy update. It includes the nutrition criteria that Health Canada themselves had put out.

We do have evidence. I will suggest that when we listen to today’s second panel, you will hear that Ad Standards, who has a long history in advertising clearance, has a long history and track record of doing so and clearing government’s own advertising. It is working. We have proven that when you look at the evidence — which we are happy to follow up with — we can say that it is working here, certainly in Canada.

Senator Bernard: Mr. Dekker?

Mr. Dekker: I agree with the comments that my colleague has made. Your first question, were we consulted by the sponsor? I don’t know if I could answer that in the affirmative. I did not have any consultation with the sponsor of this bill. I’m not sure if others in the room may have.

Senator Bernard: Ms. Furuya Chang, were you consulted?

Ms. Furuya Chang: No, we were not. We attempted to provide feedback, but no, we were not consulted.

Senator Bernard: Thank you.

Senator Seidman: Thank you to our witnesses for being with us today and for presenting your testimony.

You refer a lot to the code. I would like to ask you some questions about the code, if I may. Perhaps either Mr. Dekker or Ms. Furuya Chang, feel free to jump in.

The code says on page 3, Advertising Subject to the Food and Beverage Advertising Code, on the third line:

For greater certainty, packaging, labels, wrappers containers and product shape are not considered advertising for purposes of this Food and Beverage Advertising Code.

Well, we have talked a lot about what is advertising and what is marketing. I would like you to explain to me how you could make that kind of a statement? I’ll leave it at that.

My second question has to do with the thresholds. On page 7, you list thresholds for fat, sodium and sugars. I would like to know how you determined those thresholds. They are different from what we have heard before. What is the scientific evidence for these particular thresholds which you say are mandatory? Thank you.

Ms. Furuya Chang: To start with your first question about packaging and labelling and then the difference between advertising and marketing, again, in the discourse over the last several months, marketing and advertising, it should be clear that they are not interchangeable. Advertising is a subset of marketing and what we have included in the code goes by the same definition as Health Canada in the Food and Drugs Act and regulations define as advertising. To be consistent with the government, and their act and regulation, we have defined advertising in the same manner.

Packaging and labelling are distinct in the food and drug regulations, and they are not included and considered advertising. That’s the first part of your question.

In terms of the thresholds that we chose to use, again, we chose the same thresholds that Health Canada had contemplated and actually incorporated in their 2018 guidance document. This is the low in nutrient claims criteria. On average, it’s about 5% of the daily value, and in this case, 5% of daily value of the nutrients of concern. So if any product by serving exceeded those levels of 5% or low in, they would be ineligible and not permitted to be advertised to children.

Senator Seidman: You are saying that the thresholds on page 7 — it doesn’t sort of cohere with what you just said. If I look at your thresholds of saturated fat, sodium and sugars, it says a total of over 2 grams saturated fatty acids, or SFA, per reference amount, or RA, or serving or stated size, whichever is greater, and over 15% of energy from the SFA. Help us understand what that means.

Ms. Furuya Chang: That is the low in nutrient content claims criteria set out in the regulations that equates to roughly 5%. It won’t be 5% for every single product. Products are different by nature of their recipes and makeup and their product ingredient matrix, but the criteria that you see laid out there is the Government of Canada, Health Canada low in criteria that equates to the 5% daily value that we have included.

We have actually lifted everything that comes straight out of the food and drug regulations into our code. We haven’t adjusted any of it.

Senator Seidman: Okay, that’s helpful. If I could just go back to marketing and advertising. The bill refers to marketing in the title and the preamble but then it refers to advertising in the text. We were informed yesterday that is inconformity with the way it’s defined currently.

The one other thing that you didn’t refer to that is here is that product shape isn’t considered advertising either according to your code.

Ms. Furuya Chang: Again, when you look at advertising, just because a shape of something might be appealing, that doesn’t mean advertising. So the shape of a product —

Senator Seidman: That is marketing. It is the bigger concept of marketing. If you’re going to put a teddy bear-shaped cereal in front of a child as opposed to a circle, obviously that is marketing because the child will be tempted to try the teddy bear-shaped.

Ms. Furuya Chang: Again I will say two things: One is, because we weren’t consulted on the bill, it’s unfortunate that we weren’t able to make that distinction and clarity around the use of the word “marketing” and “advertising.” They were used interchangeably. That is problematic in the bill. That is one thing we would be happy to help and contribute to, making sure that is correct.

And then again, I go back to just because something is appealing, that is not advertising. We are talking about advertising. This is an advertising code, not a marketing code.

Senator Seidman: Thank you.

Senator Osler: Thank you to all the witnesses for being here today.

I’m going to follow up on a statement by Ms. Chang saying that the code is mandatory and already working. My question is for both associations.

For the Canadian Beverage Association, thank you for your brief. You did say it’s a complaints-based mechanism that is administered by Ad Standards. So for Food, Health and Consumer Products, again, is it a complaints-based mechanism, and is it, for your organization, administered by Ad Standards?

For both organizations, how has the public been made aware of the code and complaint mechanism? Do you know, for each organization, how many complaints against your members have been received? Can you share with the committee what is the enforcement mechanism for your members? Is it tied to licensing? Is it a financial penalty? If complaints have been received, do you know if subsequent behaviour has then changed?

Perhaps we’ll start with the Beverage Association.

Mr. Dekker: Thank you for your question. In terms of how the code is administered, there are two aspects to it. There is that complaints mechanism as you talked about, that those who would see an ad that they might feel is violating the code, that they could issue a complaint or notify Ad Standards for their review and adjudication.

Another element of the code is the robust pre-clearance mechanism that is involved. Advertisements that are in certain situations, they will be submitted to Ad Standards for their review beforehand so that they have the assurance that it meets the guidelines of the code.

Those are the two really important parts of the enforcement, both pre-clearance and then the complaints-based mechanism, which, on the complaints side, seems to also be the proposed mechanism of enforcing any of the regulations associated with this bill.

The second part, I cannot comment on. I’m not privy to the complaints against our specific members. That would be something between themselves and Ad Standards. I can’t answer that kind of a question.

Senator Osler: You’re not aware.

Mr. Dekker: Right.

Senator Osler: Health and Consumer Products?

Ms. Furuya Chang: I won’t necessarily repeat what my colleague Mark Dekker had said about the complaints-based and pre-clearance. That is clear. That is in the code. That is what Ad Standards do today. It is also what Health Canada has suggested in their remarks on November 7, that they are contemplating a complaints-based mechanism, and that they are considering referring to Ad Standards for those insights.

In terms of public education, we are fully supportive and would promote further education and widespread knowledge and understanding of this. We are, in fact, doing a webinar next week together with the Association of Canadian Advertisers, as well as Ad Standards, to make sure that consumers, advertisers, everyone understands the obligations of the industry and our commitments.

Then from an enforcement perspective, you were asking what kind of penalties. Again, I will defer to the Ad Standards experts. I don’t know which specific ads have been, but my understanding is any problematic ads have been taken down. In the 60-year history, I think there have only been a handful.

In terms of penalties, right now we don’t have the authority to issue monetary penalties. That’s why it’s not in there.

The other thing I would note is that with penalties, please make no mistake that it’s not monetary penalties alone that we as an industry are concerned with. It is reputational risk. We don’t want that for any one of us as an industry. It doesn’t need the force of monetary penalties is what we’re trying to say.

Senator Osler: Thank you.

The Chair: With the understanding of my colleagues, I would like to interject a question for clarification.

I want to know how you know this code is working if you have no knowledge of the data around complaints. How can you say it’s working?

Second, without knowledge of data or authority for penalties, how do you think you are capable of enforcing it?

If you could answer those two questions, then we could move on.

Ms. Furuya Chang: Yes. I can begin, certainly. How do we know it’s working? I think Ad Standards have a more than 60‑year proven track record that advertising clearance and pre‑clearance are working. I will defer to them and their testimony to provide the actual data, the number of complaints and the number of ads that they have ever had to pull down. Therein lies the data.

The other piece, I think in terms of the code working, we are 18 months into the burn on the code. Again, I don’t want to speak for what Ad Standards is seeing, but to our knowledge, we have received no complaints and have not seen anything that is offside.

[Translation]

Senator Cormier: I welcome our witnesses. I will ask my questions in French. I have a question for each of you. Ms. Furuya Chang, you say that the code is mandatory. I want to talk about the paragraph on the advertiser’s refusal to follow the procedure or comply with a decision. It says that, if the advertiser refuses to comply with a decision of Advertising Standards Canada or the decision of the appeal panel, they “may” notify host media that the advertiser is refusing to cooperate, they “may” make a public statement, using whatever means they deem most appropriate, to ensure that the advertiser is found to be non-compliant.

I’d like some clarification on that because “may” isn’t very strong. “May” means that you do it if you want to, and you don’t do it if you don’t want to. I’d like some clarification on that.

Mr. Dekker, in your brief you state that you support the following:

Compared to the code, Health Canada’s proposed regulatory changes have minimal additional benefits. Health Canada’s draft policy relies on outdated, inaccurate and clearly overbroad data to significantly exaggerate the degree to which children are exposed to food advertisements.

That’s quite a strong statement, actually. If Health Canada can’t be trusted, I have a problem. Could you comment on that so we can better understand the statement?

Ms. Furuya Chang: Thank you very much, Senator Cormier.

[English]

In terms of the advertisers’ adherence to the code, it is mandatory. It applies to everybody. It is not something that an advertiser can decide they are going to opt out. It still applies to them.

In terms of it actually getting to the air, if we could use that as an example, it does have to go through the Canadian Association of Broadcasters. Again, I don’t want to speak for them, but they require the understanding that that has been cleared and, if it is directed to children, that it adheres to the requirements of the code.

Senator Cormier: If they don’t do so, what is happening?

Ms. Furuya Chang: It’s taken down. It doesn’t hit the air or it is taken down.

Senator Cormier: Okay.

Ms. Furuya Chang: It cannot proceed.

Senator Cormier: Thank you. Mr. Dekker?

Mr. Dekker: Thank you for your question. A couple of the points that I wanted to review, on the focus of the nutrients to target, the code and the proposed regulation, whether it’s previous versions of proposed regulation or the proposed policy, or even the brief mention within the bill itself, the nutrients to limit, if you will, are the same, and are targeting in the same level, the same amount, as my colleague has demonstrated. So from products that would fall under the guise, they are similar.

In terms of outdated policy and data, this perhaps is referring more to previous work that has been before that really wasn’t necessarily considered here or in the HESA Committee of some of the developments within media.

I would also encourage you to maybe ask this question to the following panel on their technicalities and their understanding of the advertising landscape. As you can appreciate, in the last five or so years, there has been a shift in how advertising may be applied in Canada, including social media, et cetera. It’s important to have all of those realities.

[Translation]

Senator Mégie: In Quebec, the Consumer Protection Act prohibits advertising to children under the age of 13, while the code for advertising to children defines a child as being under the age of 12. Is there a reason for this age difference, or is this the way it was intended? On what basis did you change the age from 13 to 12? I can put that question to Mr. Savoie.

Pierre Savoie, Lawyer and Partner, LJT Lawyers, Food, Health and Consumer Products of Canada: The Consumer Protection Act provides for children aged 13 and under and the code provides for advertising primarily directed to persons under the age of 13. We have adopted the same criterion.

Senator Mégie: It seems that it’s 12 years of age. So, it’s fine.

Mr. Savoie: The reason for adopting this criterion is that it was tested by the courts in the Irwin decision, with which you are all familiar, which came to rule that the restriction that was placed on freedom of expression was justifiable for a vulnerable public up to the age of 13. Beyond the age of 13, the courts did not consider it appropriate to affect freedom of expression and introduce a restriction that went beyond that age.

Senator Mégie: Thank you. Are there advantages and disadvantages to legislating on this subject? Some say the code is good, others say that Quebec already had the Consumer Protection Act. Do you think that legislating would bring advantages or, rather, disadvantages?

Mr. Savoie: You have heard testimony indicating that the Quebec legislation achieves the bill’s desired objective. Ms. Lattanzio herself said so, and yesterday we heard a quote from Ms. Wolff to the same effect. The code was developed based on something that had been tested and that worked. The cornerstone of the code is based on how the analysis works to determine whether advertising is aimed at children.

The problem with Bill S-228 and Bill C-252 is that there is no reference to or definition of what advertising to children is. No parameters are provided, unlike in the Quebec model, on which the legislator is supposed to have drawn inspiration. That leads to a major problem, as we must remember that we are in the process of making amendments to a fundamental piece of legislation in Canada — the Food and Drugs Act, which protects the health of Canadians.

In addition, we are in a context where we are in the process of establishing a restriction on freedom of expression. These two things raise a red flag that requires us to be much more vigilant to ensure that the restriction you are about to impose is viable. I submit to you that it is not because it is totally unclear, just like Bill S-228.

The industry was actually being accused yesterday of virtually killing Bill S-228, but it’s the very wording of the bill that is problematic.

[English]

Senator Petitclerc: Thank you all for being here today. I have a question for you, Mr. Dekker. I think we’re all struggling to understand this mandatory, not voluntary, that we keep hearing about.

Mr. Dekker, I’m trying to make sense of this. You say it’s mandatory, as we hear. Then I go to the Canadian Beverage Association website, I go under guidelines that incorporate the code, and the first sentence says, “These guidelines for use by its members on a voluntary basis.” When you open the link to the guidelines, it has all the different sections. It has the scope, CBA members, voluntary commit, TV, radio, print, and so on. Help me.

Mr. Dekker: Thank you for the question. Some of the materials that are on our website are some of the commitments our members have made that go above and beyond the code and guidelines, and they may have interacted or intersected with other areas, including some of the previous work on energy drinks, et cetera. There are some additional commitments our members have made that are different or separate from the code and guide.

The mandatory nature is that all advertising in Canada for our members that are making food products, which is all of them, they have to follow this code and guide now. It is the way that our industry is moving forward.

Senator Petitclerc: It’s very puzzling, but I will move on from that. I have a very specific question, and maybe the next panel will be able to help me with it.

I’m concerned with a lot of the wording in the code, especially after the witnesses we had yesterday. Every word is a choice, like Senator Cormier said. Some of the wording in the code — you mentioned it in your opening remarks, Ms. Furuya Chang — is that children are a “special audience.” You mentioned the Irwin decision in Quebec that children are vulnerable. That’s what we hear in law. That’s what we hear at UNICEF and at the World Health Organization, and yet you chose the term “special audience.”

Why don’t you actually properly name children as a “vulnerable audience”?

Ms. Furuya Chang: I’m happy to respond to that. Thank you for the question.

Senator Petitclerc: What does “special” mean?

Ms. Furuya Chang: We’re open to having that changed. I have no disagreement with it being referred to as “vulnerable audience.” Absolutely. We are all consumers. Many of us are parents. I’m a mother of two. Absolutely.

Senator Petitclerc: Okay. Thank you. What about monitoring? It seems to me, when you say that everybody falls under the code, so all advertising, but every time one does not respect the code, they get put down. That’s what I understand. There’s the complaint mechanism, which I’m not sure how proactive consumers or parents are at complaining. I would like to see the data on that.

Apart from that, are you doing any sampling or monitoring? It seems like a lot of work. Is the code organization being proactive in monitoring what’s happening?

Ms. Furuya Chang: Great question. I will say that monitoring through a complaints-based mechanism is meant to mirror, for example, the Canadian Food Inspection Agency, which does not actually review every single label before it hits the market. It is a complaints-based system. We are suggesting that it would be very similarly executed through a complaints-based monitoring system.

Senator Burey: Thank you so much for being here. You’ve been listening to the earlier testimony, so that’s good.

I want to zero in on your arguments that this code is better than the bill, that we don’t need the bill because this code is in place. I will ask you the same question I asked Health Canada. In that question, I mentioned that I was looking at child influencers because this is a rapidly changing landscape. We have to know that. We are way behind when it comes to the effects on our children and our children’s health, and that’s what this is about.

We have these child influencers who have product placement, and it’s huge. I will not get into the numbers; it’s in their testimony. Will your code do anything about that?

Mr. Savoie: If I can answer, first, about the code being better, the code actually, as I was saying, abides by or reflects what the Quebec model entails. Just in that sense, it allows the advertiser to know how the advertisement will be treated and reviewed and analyzed.

The bill doesn’t do that. The bill is absolutely vague as to what is required by the advertiser, what he needs to do. In that sense, it’s very vulnerable to Charter challenges, as is the case for section 7.2, where we say we will allow —

Senator Burey: I do want to get to the issue because my time is limited, and the chair is very strict. I really want to get to the influencers because that’s where kids are spending so much time. Will your code do anything about that?

Mr. Savoie: Yes, it does. It specifically addresses influencers, as it does many other aspects. You can look at the list of all the media at the end of the code, in the guide. That will be reviewed, as will any other ads, as long as it’s an influencer with a relationship between an advertiser and an influencer. They become an extension of the advertiser themselves, and they’re submitted to the same rules.

Senator Burey: Health Canada did say that will be part of their regulations, and that is what will be there.

Mr. Savoie: It’s already a part of ours.

Senator Burey: I didn’t see it. I will move on to my last question which is about Quebec. One of the other issues is that the regulation would be a financial burden, on the industry, I’m presuming. But looking at data from Quebec, Quebec’s advertising ban since 1980 demonstrates measurable success in reducing fast-food purchases without stifling broader economic activity.

Did you do any kind of cost-benefit analysis on this bill? Is that what you’re concerned about?

Mr. Savoie: I’m not on the financial part of it.

Ms. Furuya Chang: Maybe I can ask you to cite the statement. I can go back to the cost-benefit analysis that we did in April of last year.

Senator Burey: In Quebec, it didn’t show that it stifled economic activity. Are you aware of that?

Ms. Furuya Chang: Yes, but I’m trying to understand — we didn’t make a statement that it’s stifling economic activity.

Senator Burey: No, but did you do a cost-benefit analysis on this bill, whether or not you think it would stifle economic activity?

Ms. Furuya Chang: We responded to the government’s cost-benefit analysis that was meant to either support or not support the bill.

Senator Burey: And?

Ms. Furuya Chang: We found that the amount of advertising pre-implementation of our code and post-implementation of our code was the same. There was no child-directed advertising. I can get you the specific numbers, but there was very minimal change.

Senator Burey: That would be very helpful. Thank you.

[Translation]

Senator Boudreau: I thank the witnesses for being here today. You may have noticed that you are rowing upstream. This is a subject that affects many of us.

You have mentioned many times that the code is mandatory, that the code works, that the code has been in place for more than 60 years. You even say in your brief that, for more than 60 years, virtually all advertising in Canada has been subject to the Canadian Code of Advertising Standards.

I wasn’t here at the time, but in 2016, this Senate committee conducted a study according to which the number of obese children in Canada had tripled since 1980. Over a 35-year period, from 1980 to 2016, obesity among children tripled.

How can you say that the code works in light of such statistics?

Mr. Savoie: There are two codes. There’s the Canadian Code of Advertising Standards, which sets out the broad principles to which all advertisers are bound, regardless of the type of advertising we’re talking about. The code we are discussing today, and which we are asking you to incorporate into the bill, is a code specific to advertising aimed at children. The person who represents Advertising Standards Canada will be able to explain it better than I can, but the Canadian code we’re talking about, which has been in force for 60 years, applies to all advertising to ensure that it is not false or misleading. It includes provisions for children, but they relate to the message, which must not be misleading in terms of their level of understanding. However, this code was not aimed at obesity in any way.

Senator Boudreau: I may have mixed up the two codes, but the most striking statistic is that obesity has tripled over a 35‑year period, from 1980 to 2016. Your code has been in place for….

Mr. Savoie: Six months.

Senator Boudreau: There was a code before that, too. You revised it in 2023, if I understand correctly. There was a code that existed before that.

Mr. Savoie: I will let Ms. Furuya Chang continue.

[English]

Ms. Furuya Chang: I would have to go back to and use dieticians as an example. I think we’ve all agreed, and I think Dr. Sharma, Dr. Aziz and Dr. Boye said this very clearly in their deputations a couple of weeks ago, that obesity and chronic disease are multi-factorial. It’s not a one-to-one direct cause and effect. It is far broader than that.

It’s unfair to say that obesity rates and the numbers that you quoted are a direct result of advertising. I will cite something else that was —

Senator Boudreau: I never said it was a direct cause. I simply pointed out the fact that obesity among youth has tripled since 1980. Obviously, what we’ve been doing for the last 35 years isn’t working. Maybe that’s why we need to push the envelope a little further.

Ms. Furuya Chang: Yes. I would say again, we agree. That is why we went forward with creating something based in Health Canada regulations and incorporates all the science that we know as well.

I want to go back to the Chilean reference yesterday. Pre‑implementation and post-implementation, there were some citations that it was working. The obesity rates in Chile were up to 16% in 2009 and have gone up to 26% in 2022, even with a ban in place. Again, I put that out there as a question to all of us. We need to be very careful about the lines that —

The Chair: Thank you very much.

Senator Dasko: Witnesses, thank you for being here today. I want to start, as you did, with the objectives. I maintain that your objectives are not the same as Health Canada’s. The bill itself that we’re examining would name the act as “the child health protection act.” It has a lens of children’s health and obesity, but there’s not a single mention of children’s health in your code. This is not an objective of the code that you’ve done. I think we have to start from the fundamental and understand that this is not your objective. You do not have a common objective with the bill that we are studying today. I want to make that perfectly clear.

There are so many things here. There’s the nutritional guidelines. It has been pointed out yesterday by many of our witnesses that your nutritional guidelines, thresholds, are less. We’re talking about the guidelines that Health Canada has put together, the new one, not 2018. That’s now history. Your thresholds are much lower, and it’s particularly the case in cereals.

We heard names of all kinds of cereals that would be permitted under your guidelines, but not under Health Canada. There’s Lucky Charms and you name it. There are a whole bunch of them that are not covered but are permitted to be advertised under your code but not be given Health Canada’s nutritional guidelines. Let’s be clear about that. Yours are more lenient, unless you’re going to say that everything that was said by our witnesses yesterday is wrong.

The voluntary language in the code is pervasive. You talked with some pride about the pre-clearance. Let’s just look at the language you’ve got, “All advertising for food and beverages may be submitted to Ad Standards for pre-clearance.” Maybe that’s voluntary. We talk about what is voluntary in the code. It’s viewed with voluntary language.

I’m particularly unhappy with your comments about there’s a monitoring complaint process. Monitoring and complaints are completely different processes. You don’t have a monitoring process. Health Canada, under the act with these amendments and the regulations, will have a monitoring. They will monitor the environment. You do not monitor the environment.

The Chair: Is there a question?

Senator Dasko: Well, where do I start? In any case, I haven’t finished my observations, but Madam Chair is after me now.

Anyway, these are just a few of the things. I could pick up on questions from every one of my colleagues because I think they’re relevant here. In any case, I just put that out.

The Chair: Would you agree?

Mr. Savoie: Can we reply?

The Chair: Yes.

Mr. Savoie: As far as the monitoring aspect of it, that’s another problem of the bill that is presented. Not only does it not have any relation to the age group that’s concerned by the restriction, because the monitoring will be to assess the impact, not on the kids that are 13 and under, but for another age group that is not covered by the restrictions.

Senator Dasko: They will monitor the environment for advertising to children to see how it’s working. In addition, you’re right about the older age group because there is a concern that there will be a displacement of the advertising that used to go to kids will now go to adolescents, who are also terribly vulnerable but who are, unfortunately, not covered by this bill.

The Chair: I’m going to go to the second round with Senator Bernard before we run out of time.

Senator Bernard: I’ve been enjoying this. I’m going to cede my time. I’d like you to finish that off.

The Chair: Senator Dasko, please continue.

Senator Dasko: Back to the monitoring, we heard from the witnesses yesterday that the monitoring of the adolescent group is extremely important because we know they’re vulnerable, yet they’re not covered by the bill. They’re not covered by your code either. They’re not covered. So, in fact, the advertising to teens could increase. It’s important to monitor that group.

That is why we have this provision in the bill to monitor those groups. But as I said, there will be a monitoring process in place. What monitoring will show us is, for example, some of the things that we learned yesterday with regard to the companies who were supposedly covered by your code versus those who weren’t. Some of them who were covered by your code were actually worse perpetrators of showing ads that were unhealthy foods to kids. We saw this from Professor Potvin Kent. She has done voluminous research. This is why your code is not effective, because they’re simply ignored, whether you’re covered by them or not, it doesn’t matter. They’re ignored.

And if you have no monitoring and no compliance, there are no sanctions. You break the code, it doesn’t matter.

The Chair: Is there a question, Senator Dasko?

Senator Dasko: In any case, I’ve made several statements.

The Chair: Would anybody like to comment?

Ms. Furuya Chang: With your first comment, we do have the same objective. As I said, I am a regulated health professional. I am, first and foremost, a dietician.

Senator Dasko: There’s nothing in the bill about children’s health.

Ms. Furuya Chang: It is the reason why we’re doing it. Part of the healthy eating strategy. Our support and commitment for the shared objective to protect the vulnerable population, that is at the essence and core of why we’ve done that.

Senator Dasko: You’ve done that code to try to get ahead and short circuit what Health Canada is doing.

Ms. Furuya Chang: That’s the irony of it. I know this is an interesting conversation. The irony of all of this, everything that Health Canada has actually articulated in their 2023 policy update that they intend to do we’ve already done.

Senator Dasko: That’s not correct.

Ms. Furuya Chang: Everything they’ve put into our 2018 guidance document is here. I would respectfully request you to show us the data because it is a lift and lock of the regulations as they exist today in the Food and Drug Regulations and how we incorporate it into the code. It is not something that was pulled out of thin air. We used the government’s existing regulations to set out the criteria.

The Chair: Thank you very much. Senators, that brings us to the end of this first panel. I’d like to thank the witnesses for their testimony today.

For the next panel, we welcome the following witnesses joining us in person. From the Association of Canadian Advertisers, Andrea Hunt, President and Chief Executive Officer; and Judy Davey, Vice President, Media Policy and Marketing Capabilities. From the Canadian Association of Broadcasters, Kevin Desjardins, President; and from Advertising Standards Canada, Catherine Bate, President and Chief Executive Officer. Thank you for joining us today.

We will begin with opening remarks from Ms. Hunt, followed by Mr. Desjardins and Ms. Bate. You will each have five minutes for your opening statements. Ms. Hunt, the floor is yours.

Andrea Hunt, President and Chief Executive Officer, Association of Canadian Advertisers: Good morning, honourable senators. My name is Andrea Hunt, and I am speaking to you today as the President and CEO of the Association of Canadian Advertisers, the ACA. Joining me today is Ms. Judy Davey, Vice President, Media Policy and Marketing Capabilities.

We are grateful to be here with you today, and I am particularly honoured to do so as I have only recently taken on this role. We want to reaffirm from the onset that we are completely aligned on the need to ensure the well-being of our children and understand the honourable intentions of Bill C-252. While we understand the intent, we have significant concerns about unintended consequences and duplicative regulation coming from a bill that has not had the benefit of scrutiny, examination and a public consultation process.

First a few words of introduction. Since 1914, the ACA has represented the collective voice of Canada’s advertising industry. Our members, over 300 companies and divisions, have collective annual sales exceeding $300 billion and employ well over half a million Canadians. The ACA is not only a key advocate for the marketing and advertising industry, we also work collaboratively with government, regulatory bodies and industry partners to ensure that Canadian advertising upholds the highest standards of fairness, truthfulness and respect of Canadian values.

In 2016, thanks to this committee’s study on child obesity and discussions on Bill S-228, the ACA recognized the need to acknowledge children as a special audience. Through convocation, the ACA proactively and collaboratively created a coalition with their industry partners. This work was no less than five years in the making and culminated in the development of the code and its application guide, receiving the support of over 10 key industry associations.

Honourable senators, not only is the resulting code comprehensive in its supporters, but contrary perhaps to what you heard yesterday, it is thoroughly comprehensive in its application.

The code in effect today restricts the advertising for foods and beverages in all media to children under 13 that do not meet Health Canada’s nutrition standards. The code exceeds Health Canada’s targeted approach to broadcasting and digital media to include bans on advertising in school through Grade 8 and product placement and product integration in any entertainment or editorial content on any medium primarily directed to children for the purpose of promoting the sale of such a product.

The code has been built on an existing knowledge base and legal precedent. The code adopts the Quebec model and the criteria of Section 249 in Quebec’s Consumer Protection Act.

The code is mandatory. It governs all companies that do business in Canada, and contrary to other previous initiatives — specifically the children’s advertising initiative — it is not voluntary. It is enforced by Ad Standards, the independent compliance partner of the federal government’s own non‑partisan advertising review process.

Not only is it comprehensive, there are consequences to non‑compliance that are significant and have the same effect as fines and penalties would have under the law. The assertion that over $1 billion is spent annually on child-directed food and beverage marketing in Canada is simply false. One billion dollars is not spent on food and beverage advertising against all audiences. In fact, many forms of advertising like TV are in decline, and child-directed advertising content represents only 0.13% of current TV viewership. Digital is growing but our code addresses this, and these platforms also have restrictions, like age gates, which is not true of conventional television.

While we agree it is important to restrict already modest levels of advertising to children, we do not believe that advertising is the single culprit for childhood obesity, nor have we seen evidence that shows it is a compelling factor.

Bill C-252, as drafted, not only raises Charter concerns, but it would also duplicate the intentions of the code at significant resource investment and brings risks of significant unintended consequences for the sector. We cannot overstate the risk of passing a bill this vague. It is significant.

Burdened by unnecessary duplicative layers of regulation, this bill will almost certainly have an economic impact and affect the support for media, talent and creativity, as well as impose unwieldly governance and financial consequences more broadly for both government and industry. The policy intervention is disproportionate to the intended objectives.

While we believe the code is working, we reiterate our willingness to work with the government on improvements. Should you believe this is insufficient, we invite you to consider incorporating the code by reference to Bill C-252, as it provides certainty and offers a turnkey solution.

I began by applauding the intentions of the bill. Why set aside five years of progress and significant investment at taxpayers’ expense when there is an exceptional solution already in place?

We respectfully submit that the industry code is the best, fastest and most effective way for the Government of Canada to achieve its policy objective. It is already in force, and its effectiveness has been demonstrated. Let’s give the code a chance.

Thank you again for the invitation to appear today. We would now be pleased to answer any questions.

The Chair: Thank you, Ms. Hunt.

Mr. Desjardins, please proceed. The floor is yours.

Kevin Desjardins, President, Canadian Association of Broadcaster: Thank you, Madam Chair and members of the committee.

[Translation]

Thank you for the opportunity to appear before this committee to participate in this important discussion. We represent over 700 private stations and services that make up the Canadian Association of Broadcasters.

[English]

We appreciate the opportunity to present the point of view of Canada’s private broadcasters on this legislation and the committee’s work to ensure that this bill receives an appropriate review and discussion from all stakeholders.

This proposed legislation is well intended, and, in general, we would support the goals of nutritious eating and good health for Canadian children. But let me be very clear at the outset: This legislation will not achieve the goals set out by its proponents.

Unfortunately, the legislation before us is vague, imprecise and, in places, simply incorrect. It provides broad powers to a government department in areas where they do not have the appropriate competencies or knowledge. It takes a complex and multi-factorial problem and reduces it to a simple solution. And yet, even officials from Health Canada will not say that the actions envisioned in this legislation will provide measurable beneficial outcomes to children’s health.

If the goal is to ensure that advertising for certain products is not targeted to young children, we believe that there are other means that achieve this.

The Code for the Responsible Advertising of Food and Beverage Products to Children is a solution that we believe would achieve everything that this legislation proposes. It would also provide support from those with knowledge of the advertising and media industries, and would not require Health Canada to undertake new and additional activities that are outside of its capacity and expertise.

Beyond the code, we believe that there is an important discussion to be had on how this legislation would actually function from the point of view of the Canadian-owned media companies, including Canadian broadcasters, who will pay the most significant price.

When this bill passed through the other place, the Standing Committee only heard from the bill’s sponsor and Health Canada. The rationale was that a similar bill had been proposed five years ago, and it had been studied appropriately then. Yet, this legislation contains a glaring factual error within its preamble, stating that the Broadcast Code for Advertising to Children is a “voluntary measure.”

To be clear, this code is a condition of licence for Canadian broadcasters, and it is not voluntary.

While it is debatable whether the science supporting public health rationales for this legislation went unchanged over the past five years, it is absolutely inarguable that the media landscape in Canada has not shifted fundamentally. In 2012, digital advertising accounted for approximately 22% of the Canadian market. Now, that figure is over 70%, the majority of which is on foreign-owned platforms.

What we have yet to hear from anyone in this discussion is how Health Canada intends to address advertising through digital platforms and social media. We know that they can exert their power on Canadian-owned media, but we also know from experience that in today’s digital age, an abundance of advertising can reach Canadians outside of this domestically regulated media.

Whether that is advertising reaching Canadians through American channels through their cable packages or multinational corporations advertising on global digital and social media platforms, this regime will not address those media impressions. This matters because advertising remains the lifeblood of the Canadian media industry.

When the ability to advertise with Canadian companies is constrained, it directly impacts the ability for broadcasters to support essential democratic activities within their newsrooms and their ability to support the creation of Canadian stories. We understand that the original intent of the legislation may have been narrow and noble, but the language within the legislation creates great uncertainty for advertisers as to what products they can advertise and where and when.

We support allowing the Code for Responsible Advertising of Food and Beverage Products to Children to demonstrate its effectiveness, but we will also provide a couple of important amendments before passing this legislation.

First, removing the factual error in the preamble with regard to The Broadcast Code for Advertising to Children.

Second, we would recommend that a new provision be added to the bill to set parameters around the definition of advertising directed primarily at children. More specifically, we would recommend the language that is used in section 249 of Quebec’s Consumer Protection Act.

Third, third we recommend removing, in its entirety, clause 7.3.

Should there be a desire to expand the powers of this legislation, it should be undertaken through the normal and reasonable democratic process.

The Chair: Thank you, Mr. Desjardins.

I will hand the floor over to Ms. Bate.

Catherine Bate, President and Chief Executive Officer, Advertising Standards Canada: Thank you, Madam Chair and esteemed senators. Good afternoon. Thank you for your time today.

My name is Catherine Bate. I’m the president and CEO of Ad Standards Canada.

Ad Standards is Canada’s national, not-for-profit advertising self-regulatory organization. Our mission is to ensure that advertising on all media — digital, print, broadcast, online, social, et cetera — is responsible, truthful, fair and accurate.

Self-regulation is a common form of governance in the advertising industry. Worldwide, there are now approximately 50 advertising self-regulatory organizations; Canada was one of the first. Sitting at the intersection between the public, government agencies and the advertising industry, Ad Standards brings a unique perspective to our specialized skill of advertising analysis.

I am grateful for the opportunity today to highlight from our brief our work at Ad Standards as it relates to the senators’ consideration of Bill C-252, and our role in the administration of the code that is being discussed today. Our work in that regard involves both proactive pre-clearance of ads, and responsiveness to complaints, and we have extensive expertise in both mechanisms.

For approximately 60 years, Ad Standards has addressed complaints that we receive about advertising under a separate Canadian Code of Advertising Standards. The Canadian code sets principles that apply to all advertisers, regardless of membership in Ad Standards. It is enforced through a robust system, guided by detailed procedures, to respond to complaints from consumers, competitors and advocacy groups.

Advertisers who are found to be non-compliant with the Canadian code are required to amend or permanently withdraw their advertising. If they fail to do so, Ad Standards will notify carrying media to remove the contravening ad, post notifications of the violation on our website or advise the Competition Bureau of the failure to comply.

The overwhelming majority of cases resolve voluntarily and immediately, without the need for further intervention. This proven model for effective resolution of complaints and compliance forms the basis of the procedures applicable under the code, which I will discuss in a moment.

First, I wish to briefly touch upon pre-clearance services. This is a process by which advertising is reviewed for compliance before it reaches the market. Ad Standards has been responsible for the pre-clearance of all broadcast advertising directed to children in Canada for over 50 years. In this sector, we pre-clear for compliance under the Broadcast Code for Advertising Standards, which was just referenced by Mr. Desjardins.

Ad Standards’ work under this broadcast code, along with the child-directed provisions under the Canadian Code of Advertising Standards has created in Canada one of the strongest frameworks in the world for regulation of advertising directed to children.

In addition to children’s pre-clearance, Ad Standards began pre-clearing food in 1992, when that responsibility was passed to Ad Standards from Consumer and Corporate Affairs.

Ad Standards is also recognized as an advertising pre‑clearance agency by Health Canada for a wide variety of consumer health products, and has an excellent relationship and history of working with Health Canada to pre-clear advertisements and address complaints.

Ad Standards began pre-clearance under the Code for the Responsible Advertising of Food and Beverage Products to Children — the code that is the subject of discussion today — less than 18 months ago.

As with all areas pre-cleared by Ad Standards, two analysts who have undergone training specific to this code review each submission, ensuring thoroughness and consistency. We conduct our reviews in both English and French and examine each submission under all three criteria identified in the code, mirroring Quebec’s Consumer Protection Act.

Ad Standards enforces the code through a complaints-related mechanism, like under the Canadian code. Reporting, compliance and enforcement apply to all food and beverage advertisers in all media, regardless of whether they sign on to any code and regardless of membership in Ad Standards. Compliance with this code is mandatory. Again, if an advertiser fails to comply with a direction to withdraw their advertisements, there are repercussions. In addition to the withdrawal or amendment of the ad itself, if that is not adhered to, Ad Standards will notify carrying media that the advertisement violates the industry code and will seek their assistance to withdraw the ad.

Ad Standards will also name the advertiser in its compliance report and may post a notice of non-compliance on its website. This has proven to be an effective means of achieving compliance under the Canadian code, and we expect the same effective results under this new code.

With that, I conclude my prepared remarks and look forward to your questions. Thank you.

The Chair: Thank you very much.

For the panel, senators, you will have four minutes for your succinct and concise questions, and that includes the answer. Please indicate if your question is directed to a particular witness or witnesses.

The first question will be from Senator Bernard, deputy chair.

Senator Bernard: Thank you all for being here. I would direct my first question to Mr. Desjardins. Did you have another recommended amendment that you weren’t able to share with us?

Mr. Desjardins: I have a third recommended amendment. I will just to go through it because I was speaking a little quickly.

Third, we recommend removing clause 7.3 in its entirety. Should there be a desire to expand the powers of this legislation, we believe it needs to be undertaken through a normal and reasonable democratic process and not through a “fast pass” as has been suggested here. That was just to be clear on that last one.

Senator Bernard: Thank you. My next question is this, and this can be to any of you: With regard to the code and limiting marketing to young people, are there any processes to address media literacy for children, to reduce the impact of advertising? Is that part of the work of the code?

Ms. Bate: I can start with that question. Specifically under the code, we at Ad Standards do not have a mandate for media literacy education specifically. There are other organizations. I am trying to remember the organization’s name — I do apologize — that was responsible for the house hippo campaign, which just came back recently. I think Canadians can be quite proud of it.

So there are organizations that do complementary work, but the literacy piece is not specifically addressed in the code.

Ms. Hunt: From the standpoint of the Association of Canadian Advertisers, we certainly would be open to working with the government on efforts, either alone or in partnership with other associations who are already doing more focused work, but, yes, absolutely.

Mr. Desjardins: There is an organization called MediaSmarts; I believe that’s the one. I know many of our members support MediaSmarts. Media literacy is a very good topic of discussion, and we should examine this legislation through that lens.

Senator Bernard: Thank you.

Ms. Hunt, you referenced twice in your remarks, “unintended consequences.” I would like you to expand on that, please. Tell us what are the unintended consequences you would see from this bill if it were adopted.

Ms. Hunt: I mentioned in my opening remarks that I am new in the role, so I will not pretend to understand the many nuances of the code as it has been developed and built over many years. I have colleagues with decades of experience and more with many decades from beyond. From what I can understand and appreciate, there is a lot of vagueness in the proposed bill. As such, with vagueness, there can come complexity, both in terms of governance and also in terms of unintended financial consequence.

There may be someone on my panel that can speak more clearly, but it’s less about something specific as a consequence and more about the void of clarity. There is room for much confusion and much cost in complexity, in time and in money as a result of that.

Senator Bernard: Perhaps Ms. Davey could get a response in.

Judy Davey, Vice President, Media Policy and Marketing Capabilities, Association of Canadian Advertisers: One specific unintended consequence could be the creep up to include adults. While it is directed to children, because of the vagueness and the way it’s worded that definitely could be an effect for adults as well, which is something we don’t want to have happen.

Senator Bernard: I was worried about that.

Senator Seidman: Thank you very much for your presentations. I address my question to you, Ms. Bate, because I’m looking for data. I’m hoping you might have some.

The Code for Responsible Advertising of Food and Beverage to Children says:

All advertising for food and beverages may be submitted to Ad Standards for preclearance under the Food and Beverage Advertising Code.

How many advertisements have been submitted to your organization for pre-clearance since the implementation of the code?

Ms. Bate: I certainly recognize the importance of that question. I will get back to you to confirm what I can disclose. The reason for that is we treat the advertising pre-clearance process as confidential in order to encourage people to participate in the process and so that there are no negative consequences for those who do the right thing and come forward and submit to us for pre-clearance. I will endeavour to look into what we can disclose in that regard.

Senator Seidman: Thank you. We look forward to that information.

The code also states:

In cases where the advertising is primarily directed to children, Ad Standards may rely upon an attestation from the advertiser that the food or beverage complies with the nutrition criteria set out in Appendix A.

Why is an attestation sufficient? In how many instances has Ad Standards relied on an attestation from an advertiser since the implementation of the code?

Ms. Bate: The attestation process is used quite broadly, actually, within the pre-clearance category, not only for this category but for others as well, due to the volume of submissions that we receive and where it is purely factual confirmation. That’s not to say that the attestations are not checked to verify.

We do have a registered dietician on our staff, as well as staff who have had more than 25 years of analysis of advertising under the Food and Drugs Act and regulation. There is a back-up to the attestation, but the attestations are used quite regularly in order to accommodate for the factual confirmation.

I can assure you that if our analysts had any doubt as to whether a product falls on one side or the other, they are themselves looking at the nutrition facts table. Hence it may rely on that as a way of confirming that, yes, we have that on the record.

Senator Seidman: You kind of gave something away, so I go back to my first question about the number of advertisements submitted for pre-clearance. You said, because of volumes, you rely on attestations. That implies that you get volumes.

Ms. Bate: Across all of our pre-clearance sectors, yes, absolutely. We pre-clear under this code, food broadcast advertising to children, health products and alcoholic beverage advertising.

Senator Seidman: The code states:

If, upon review under the Procedure, Ad Standards determine that the advertisement do not comply with the Food and Beverage Advertising Code, the advertiser will be required to withdraw or appropriately amend the advertisement without delay.

How many advertisers have withdrawn or appropriately amended their ads? In other words, how many ads did you find needed withdrawal and or amendment?

Ms. Bate: The section that you’re referencing is under the procedure for complaints. We have not yet had an instance that has required a complaint to be acted upon. We have not had complaints. I would like to explain why for two reasons.

One is the code is only 18 months old, so it does take time for people to become aware. The Canadian Code of Advertising Standards, which has been around for much longer, we receive thousands of complaints. Last year it was about 1700 complaints that we received. So consumers are aware of the complaints process.

We’ve taken the first step, which was to update our portal, and on that complaints page call it specifically advertising of food and beverage to children to alert consumers and make them aware this is a category under which we accept specific complaints, but we haven’t received them yet.

Senator Seidman: You’re taking an active role in trying to put out information on your website, so consumers know there is a complaint mechanism?

Ms. Bate: Definitely, yes.

The Chair: Just a point of clarification, if I could insert a question here: You were saying there are volumes that your not-for-profit is receiving in terms of applications. You also mentioned you have two analysts that are trained up specifically. How are you managing this?

Ms. Bate: Thank you for the question. Let me clarify. I probably spoke too quickly. We have a team of analysts. Each ad is reviewed by two. We have more than two analysts. Analysts are specialized in different areas. We have a team dedicated to health products. Our team that reviews under this particular code also has experience in advertising to children and alcoholic beverage advertising, to be alert to the sensitivities of what might appeal to a minor, to a child. It is a team, and we draw from that team for each submission two analysts to ensure there is thoroughness of the review, because one set of eyes can always miss something or read something differently, and consistency.

Senator Osler: Thank you for the witnesses being here today. I’m going to clarify to Ad Standards, and thank you for the clarification. I’m going to ask you a series of questions for clarification.

The two-team person, that’s for pre-clearance?

Ms. Bate: That’s correct.

Senator Osler: Did I hear you correctly to say that under the complaints procedure under the code for Responsible Advertising of Food and Beverage Products to Children, you have received zero complaints?

Ms. Bate: To date, that’s correct.

Senator Osler: I was going to ask you questions about that but that answers that. If those complaints were to come in, looking at the website under that complaint procedure process; again, it’s a two-person team, the director of pre-clearance services and the chief legal officer. That’s why I couldn’t find any data on summary reports, because you have not received any complaints?

Ms. Bate: For two reasons; one is because we haven’t received the complaints yet, but we have undertaken to issue a report only in Q1 of next year so we would have enough time for some experience with the code.

Senator Osler: Okay. I’m going to ask you a separate question because it’s regarding procedures. I was also looking at the complaint procedure for children’s broadcast advertising. In that process, there’s mention of a consideration for children’s broadcast advertising that council considers if the complaint is coming from advertisers or a special interest group.

Now, would you see or will your two-person team for that complaint procedure, under the Responsible Advertising of Food and Beverage Products to Children, also have consideration of special interest groups? Can you expand on that a little bit as it refers to broadcasting? Is that going to carry over to this complaint procedure?

Ms. Bate: Yes, it will. The complaint procedure that is slightly old language — we use “advocacy groups.” I will make a note to update our site accordingly. We do have in the procedure related to complaints under the code for Responsible Advertising of Food and Beverage, you will see reference to two categories of procedure. One is for consumers and the other is for industry and advocacy groups.

In other words, those who are in the advertising business, we have a cost recovery fee to support the work of our not-for-profit in order to triage those complaints and zero charge whatsoever for the consumers to submit their complaint.

Senator Osler: In that group, consumers, an individual parent who’s concerned, and then advertisers and advocacy groups. I understand that for the advertisers, there would be financial penalties. Would the same apply to advocacy groups? Could you give us an example of an advocacy group that could potentially fall into that category? Are they also responsible for cost?

Ms. Bate: I’m sorry I don’t have the number in front of me. It’s a de minimis cost. I don’t have that number of the top of my head. But, yes, anyone in the advertising ecosystem.

Currently the same principle applies under our advertiser disputes under the Canadian code. This again mirrors the same model. Whether that be an advocacy group of any sort, without wanting to identify any particulars, but think of Heart & Stroke, for example, Greenpeace, that is the type of organization that would fit as both an advertiser themselves, but also happen to be an advocacy group.

Senator Osler: Are you able to give us examples of advocacy groups? For example, yesterday we had a coalition called Stop Marketing to Kids Coalition. Would they be considered an advocacy group?

Ms. Bate: Yes.

Senator Osler: I’ll leave it there and maybe I’ll go back on the second round.

[Translation]

Senator Cormier: My first question is for Mr. Desjardins.

Mr. Desjardins, I would like to understand your concerns about section 7.3, since you are proposing to remove it. You say that expanding the powers under this bill could include people aged 13 to 18 and should be done through a thorough review and discussion of the merits, costs and benefits of the legislation, and so on.

Unless one has a different understanding, section 7.3 simply provides for the review of the effects of certain provisions of the legislation by a parliamentary committee. The restrictions in the bill apply only to children aged 13 and under. Can you explain to me what your concerns are, to determine whether we have a similar understanding of section 7.3?

Mr. Desjardins: Our fear is based on the fact that this will become a way of passing these restrictions on to children of that age.

Some groups said last night that there was a reason they didn’t go all the way up to 18 years of age, and we heard it again this morning. Our fear is that this could become a legislative process with only one measurable effect, which is an increase in investment in advertising aimed at this category of people. This bill will not be a review to see whether it is effective and whether it will have the desired effect. We fear that this will become the legislative process to expand this bill.

Senator Cormier: I don’t necessarily share your opinion, but I respect it, sir.

My next question is for Ms. Bate and it ties in with the question I asked Ms. Chang; it concerns the language used.

Ms. Bate, you say that the code is mandatory; at the same time, there is a notion of will that comes into play. In your brief, you say:

If an advertiser fails to comply with a direction to withdraw or amend their advertisement…Ad Standards will notify carrying media…seek their assistance to withdraw the ad. Ad Standards will also name the advertiser in its compliance report and may post a notice of non-compliance on its website.

All the language used is extremely soft, if I can put it that way. Would you agree that weak language like that tells us that your code doesn’t have the strength it should have?

[English]

Ms. Bate: Thank you for the question and for the important issue. In part, because it is a new process and so the procedure is in play. I shouldn’t phrase it that way.

We always look for improvements and clarifications. This is a new process, although modelled on something that has 60 years of success to ensure it still works.

So yes, the language does allow for some give and take, but we have no intentions — let me assure senators — of applying it any differently based on what we’ve seen at this point in the Canadian Code of Advertising Standards, which is that ads are removed if they are non-compliant.

[Translation]

Senator Mégie: My first question is for Ms. Hunt and it’s in French. Your association, the Association of Canadian Advertisers, is responsible for informing its members and proposing new ideas in the form of guides, best practices and advisory services. Are the best practices you propose inspired by Quebec’s or international ideas and standards? Where do they come from?

I could put my second question to Ms. Bate. You said earlier that you had committees of experts to assess, at the pre-clearance stage, what had been submitted. Do you also have a committee of experts to deal with complaints, to avoid being judge and jury at the same time? Those are my two questions.

[English]

Ms. Hunt: Thank you, honourable senator. Judy Davey supports our marketing capability practice and probably would be best poised to answer that question.

Ms. Davey: Yes. Specifically with regard to best practices, it’s for marketers, so it’s very broad. It can range from anything on how do I best compensate my advertising agency to what are the best media for me to advertise on. We’re a member of the World Federation of Advertisers, which is a global association, so we do touch base on things that are global in nature. We have a number of members who are global in nature, but we also have Canadian-specific members. It’s very broad, and it’s based on what our members are interested in.

We speak with our members on a very regular basis, and we know what their hot topics are. We respond to the needs and desires of our members and address that accordingly.

[Translation]

Senator Mégie: Thank you. Ms. Bate?

[English]

Ms. Bate: Thank you for your question. At the first review, the review of the complaint is done at the staff level, so that is assessed by our chief legal officer and our director, who is responsible for both the children’s sector as well as the food sector. He also has supervision over alcoholic beverages to assess the complaint. Should it proceed, we do have the ability to pull together a panel. Again, this has not been tested yet under this code but has been used consistently over decades under the Canadian Code of Advertising Standards to bring together a panel to review the complaint, which is external to our staff.

[Translation]

Senator Mégie: Thank you.

[English]

Senator Petitclerc: Thank you for being here today. I have a few questions. First, I want to continue with enforcement because I think we’re all very puzzled by the choice of the word “may.” It shows up everywhere in the code, and I see it four or five times in the enforcement.

In one part of your enforcement, it says — I won’t repeat the part that Senator Cormier read — “. . . may request the assistance of host media to withdraw . . . .” Meanwhile, this piece of legislation that is amending the Food and Drugs Act, in that act, if you contravene in an equal scenario, then you have a contravention. There could be a prosecution. There are penalties and decisive actions. It’s a very different consequence. I want to hear from you on that.

Ms. Bate: Absolutely. Thank you for the question because I think that is something that’s misunderstood within the self-regulatory model.

The consequences are manifold. I will first discuss what the consequence of having to withdraw the ad looks like and then also your concerns about the word “may.”

First, with the request to withdraw an ad, that means the advertiser has lost the value that went into the production of that ad, such as the costs sunk into the production, the distribution, the media purchase — they may have lost the media buy — as well as their relationship with the broadcaster. There are economic penalties. Although it may not be an additional fine that we do not have the authority to impose, there are economic consequences for the advertiser.

Furthermore, if it’s public that the ad did not comply, that in itself is a significant harm to the brand. We’ve seen this and heard this from those involved in the process and evidenced by the vast majority of complaints where compliance is achieved simply by informing the advertiser under the Canadian Code of Advertising Standards of a violation. In the overwhelming majority, it results in the advertiser amending or withdrawing the ad, no further questions.

In the past five years, we have had four instances where the advertiser did not immediately comply within our procedures, and all were managed with further follow-up without having to resort to any further steps, meaning nothing had to go on our website and no referrals needed to be made to the Competition Bureau. It was managed without the need for additional regulatory cost or oversight.

To your question about “may,” in the instance that you provided, it sometimes depends on the advertisement. For example, we “may” notify the host media. We’re able to do that in the case of broadcasters because we have a relationship; we know them, they know us. Where we cannot is if it is the advertiser’s own website, there is no host media because they are the host media. That’s one of the reasons for the “may.” We’re procedurally technical in that sense, so we may not be able to in those instances, but then we move along the course of options in order to achieve that compliance.

Ms. Hunt: Might I add, honourable senator, advertisers want to do the right thing. There’s no advertiser that wants to be outside of regulation or be made an example of. To Ms. Bate’s point, there’s strong reputational damage, there’s brand damage, there’s damage with our customers, our constituents and there are competitive implications. Nobody is looking to step outside of or to go against the system, which is why that clarity has been provided in the code. Again, it’s imperfect. We can absolutely enhance it.

Senator Burey: Thank you so much for being here. I’m also trying to understand this. I see we’re dealing with two codes, the Broadcast Code for Advertising to Children and then the new food and beverage code, which is the new one that was just instituted.

We’re using “the code,” but we’re talking about two different codes. In terms of the Broadcast Code for Advertising to Children, I was just looking at the section 7, Promotion by Program Characters, Advertiser-Generated Characters, and Personal Endorsements. Subsection (b) states:

This prohibition does not apply to puppets, persons and characters created by an advertiser which may be used by advertisers to sell the products they were designed to sell as well as other products produced by the same advertiser or by other advertisers licensed to use these characters for promotional purposes.

So this is the code for children, but you have said that the prohibition does not apply to the very people we want it to apply to. That’s the advertising code.

Now I see this new beverage code as coming into fruition because of the failure of the advertising code, which was supposed to protect kids. Can you comment on that? We’re talking about two codes. Is there a failure in your code for not protecting kids? Is this why we are here today?

Ms. Bate: I’m happy to start that. Mr. Desjardins may have more to say, I’m not sure.

You’re absolutely right, there are at least two codes on the table, which is very confusing, I appreciate, so thank you for your patience with that. To your question, there are two codes. One is the broadcast code, which has been around for many decades, and then this new code.

The broadcast code, to be clear, applies to all products, all categories, all services. It was never drafted with a food-specific intent. It was intended to govern what could be viewed in broadcast advertising on children’s programming. That exists in addition to and continues to remain with now the industry code intended to add additional requirements and additional food-specific issues and concerns and to provide a mechanism specific for pre-clearance and complaints that are specific to food in the context of children.

The broadcast code is a broader sector that applies to anything from toys to clothing to apps for their phones versus this code that is specific to food.

Senator Burey: Do you have any comment?

Mr. Desjardins: Just to build on that, we welcome the code that has additional specificity on this, where the broadcast code for advertising to children is broader.

I do want to take a step back and, again, it’s this idea of failure. This is a multi-factorial problem. Even the health experts will say that. Any challenges that there have been in terms of childhood obesity and childhood health cannot be reduced to one aspect, one factor. I would push back on that. I would say that there are a broad number of factors. I don’t believe that the advertising codes have been a failure. I think that, by and large, they’ve been a success.

Senator Boudreau: I want to come back to a statistic that really struck me, which we talked about with the first panel. I’m sure you’ve heard me say it already, but I’m going to say it again.

Back in 2016, this Senate committee — different people around the table at the time — conducted a study on childhood obesity and basically was able to conclude that since 1980 leading up to 2016, which already is almost 10 years ago, child obesity in Canada has tripled in a 35-year period. That’s not a good statistic.

I’m not saying that food and beverage marketing directed at children is the only cause of this, but I would argue it’s certainly one of the causes of this. The definition of insanity is doing the same thing over and over again and expecting different results. In this case, we’re getting different results but they’re getting worse and worse. Childhood obesity has tripled in the last 35 years.

How can we believe that what we’re doing today is sufficient to protect our children?

Mr. Desjardins: Can I make a comment on this? I do want to take a step back because, again, it’s another instance where we are carrying the burden of a very broad societal challenge. We’re grateful to finally have the opportunity to be able to speak to this.

I want to come back to something here in terms of what it is that we can do. A point that I was making earlier, I think something that I can illustrate that folks will understand, Health Canada has very restrictive guidelines in Canada for how pharmaceutical drugs are advertised, and yet we’ve all seen them. We’ve all seen the 60-second or two-minute-long ads because they come in through NBC, ABC, CNN or MSNBC. The ads that people are concerned about within this context are going to continue to come into the Canadian market. They are going to come in through social media. They’re going to come in through external media that come into the Canadian market. So for us, we don’t want to carry the entire burden of this, especially since the Canadian media are the only ones that are being caught by the very leaky sieve of this legislation.

Senator Boudreau: That’s not my main point. My main point is whatever we’ve been doing collectively over the last number of decades clearly isn’t working because the trend is going in the opposite direction.

I’m not saying that it’s all your fault. What I’m saying is that at that point we have to shake things up and look at doing things differently if we want better results. The results have not been there. In fact, they’re trending in the opposite direction.

Ms. Bate: I will direct the senator’s attention to the fact that this is an entirely different program than what existed during the date ranges that you’re speaking to. The pledge program was a voluntary program where participants can create their own criteria has been abandoned and we only have 18 months of experience with this new program. I would respectfully say it’s not repeating the same wheel. The wheel has been reinvented. A new structure has been created and is now applicable.

Senator Dasko: Thank you to our witnesses today. Health Canada, when they testified here a few weeks ago, as you know, they are in the middle of developing the regulations that would deal with how to measure ads directed toward children and how they will deal with that, as well as nutrient levels. As you know, they’ve been working on that for quite a while. You’ve expressed concerns, especially Mr. Desjardins, you have a whole new amendment that you’d like to put in that would sort of define how that works.

When they came here, they expressed great willingness to consult on the regulations for the bill. My question to you is, if this bill passes as is, would you be willing to meet and work with Health Canada to express your concerns? Ms. Hunt, if the bill passes as is, given their express openness to consult, would you be willing to work with Health Canada? You can just say yes or no.

Ms. Hunt: Yes, honourable senator. Our preference would have been to work, not to get to this point, to have input prior to. But absolutely we’re open to working with, if the strategies to date have not worked thus far, what more creative solutions can we find within and beyond the code? We are absolutely very keen to work with them.

Senator Dasko: Mr. Desjardins, if the bill passes as it, given the openness of Health Canada officials, would you be willing to work with them to express your concerns about whatever it may be, the regulations or how these issues are measured, provisions of the regulations? As you know, they haven’t been set in stone yet. They’re open. That is why they came here and said they wanted to consult.

Mr. Desjardins: They will be open to the extent that Health Canada wishes to be open on the other side of legislation passing. I think that’s part of the reason why you have legislation is to direct departments and agencies in how they exert their power. I think that we have experience of having worked with Health Canada in the past, especially on advertising issues, which is that a consultation is saying something and Health Canada doing whatever they were planning to do.

Senator Dasko: Ms. Bate, are you willing to meet with Health Canada after the bill passes to work out issues that will affect the advertising industry?

Ms. Bate: Our role as a self-regulatory body is not to create laws. I’m here to inform. We would liaise with Health Canada on a regular basis, so, of course, we’re happy to work with and discuss, but we would not raise concerns or objections. That is not our role.

Senator Dasko: So you would be willing to work with them as they develop regulations.

Ms. Bate: As we do, yes.

The Chair: Thank you very much. I have one quick question for Ms. Bate. You are funded by your members to join your group. What percentage of your funding is directly from other advertising agencies in the industry?

Ms. Bate: That is a statistic I would have to pull for you.

The Chair: Do you receive funding from the advertising industry at large?

Ms. Bate: We do receive funding in at least two different primary channels, one being through membership. I will emphasize the fact that the membership status does not impact the work of our pre-clearance analysts or our complaints or our disputes people; the second is through self-funding service pre‑clearance.

The Chair: Thanks. We have no more time. I know Senator Osler and Senator Petitclerc had questions. I’m going to suggest we ask them for a written response.

Senator Osler: Thanks, Madam Chair.

Ms. Bate, you had mentioned a summary report that will be coming out in Q1?

Ms. Bate: Correct.

Senator Osler: The data is not available for sharing yet?

Ms. Bate: It is not at this point.

Senator Osler: Thank you. That was my question.

Senator Petitclerc: Thank you for this opportunity.

My question is many codes already co-exist with present laws and regulations. What we have been hearing is your code goes beyond this legislation anyway.

My simple question is why not continue to co-exist? We have all heard it’s all a big piece of a puzzle coming to a solution, maybe a written answer. You don’t want to answer?

Mr. Desjardins: That’s a big question to ask with no opportunity to answer.

Senator Petitclerc: I know. I apologize.

Mr. Desjardins: I’m happy to answer it in writing, it may be pages and pages, possibly in crayon.

The Chair: We welcome your response.

Senators, this brings us to the end of the panel. I would like to thank the witnesses for their testimony today and for their willingness to go beyond the allotted time. We have constraints with interpretation, so we have to end on time.

Thank you very much.

(The committee adjourned.)

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