A cross-border advertising campaign should not be treated as one set of claims that can simply be reused in two markets. Canada and the United States both prohibit deceptive advertising and impose substantiation requirements on certain advertising claims, but the applicable legal standards are not identical.
Performance claims, environmental statements, sale pricing, origin claims, testimonials, reviews and endorsements can all be treated differently.
That matters because ordinary marketing language can carry factual meaning. Statements such as “lasts twice as long,” “Made in Canada,” “eco-friendly,” “regularly $199, now $99,” or “recommended by professionals” may require evidence before publication.
For businesses selling or advertising in both countries, the practical approach is to identify what each campaign claims, confirm what evidence supports it, and review the Canadian and U.S. versions separately where the applicable standards differ.
This article focuses on the main federal advertising frameworks. Provincial and state consumer protection laws, industry-specific legislation and other regulatory requirements may also apply depending on the product, service, audience and location.
How Canada and the U.S. Assess Advertising Claims
In Canada, the Competition Act prohibits materially false or misleading representations. Courts consider both the literal wording of a representation and the general impression it creates.
That means the analysis is not limited to the headline. Images, layout, price presentation, qualifications, comparisons and surrounding language can all affect what consumers are likely to understand from an advertisement.
A technically accurate sentence can still create a misleading overall impression.
The U.S. Federal Trade Commission also considers express and implied claims. Objective claims generally need a reasonable basis before they are disseminated. The required support depends on factors such as the type of claim, the product, the consequences of a false claim and the evidence experts in the field would consider reasonable.
For marketing teams, the review should begin with the advertisement as the customer will experience it, not only the sentence the copywriter intended to make.
Claims about effectiveness, performance, durability, speed or measurable results deserve particular attention.
Examples include claims that a product:
Under Canada’s Competition Act, certain claims about a product’s performance, effectiveness or length of life must be based on an adequate and proper test, and that testing must take place before the claim is made.
The U.S. standard is framed differently. The FTC generally requires advertisers to possess a reasonable basis for objective claims before dissemination. If an advertisement expressly or implicitly promises a particular level of proof, such as “clinical studies show” or “tests prove,” the supporting evidence should match what the advertisement communicates.
These standards should influence the copy from the beginning.
If testing shows a 17% improvement under defined conditions, that evidence does not automatically support “20% better,” “the best-performing option,” or a broad comparison against competitors.
Strong advertising does not necessarily require weaker claims. It requires claims that are appropriately supported by the evidence behind them.
Environmental marketing deserves a separate review because short phrases can communicate broad benefits.
Terms such as “green,” “sustainable,” “eco-friendly,” “carbon neutral,” “low carbon,” “recyclable,” “clean” or “better for the planet” can suggest more than the business intended.
Canada’s Competition Act contains specific provisions addressing environmental representations in addition to the general rules against materially false or misleading advertising. Depending on the claim, environmental representations may require adequate and proper testing or substantiation.
Canada amended those provisions again on March 26, 2026. The change removed the requirement that certain environmental claims be substantiated using an “internationally recognized methodology.” It did not remove the broader restrictions on false or misleading environmental claims or the testing and substantiation requirements that can apply to particular representations.
In the United States, environmental claims are governed by the FTC Act, while the FTC’s Green Guides explain how federal truth-in-advertising principles apply to environmental marketing. The Green Guides are guidance rather than a separate prohibition, but they provide important direction on how claims may be interpreted and qualified.
The FTC cautions businesses against broad, unqualified claims such as “green” or “eco-friendly” because those statements may communicate environmental benefits that are difficult to substantiate.
Specific statements are usually easier to evaluate.
For example, instead of:
A business may be able to make a more precise statement such as:
The second claim identifies exactly what the business is asserting and what evidence needs to support it.
A discount advertisement communicates more than the current selling price.
If a business advertises:
the customer is also being told that $199 is a genuine reference price and that the advertised reduction represents real savings.
Canada has specific ordinary selling price provisions under the Competition Act. A claimed regular price may need to satisfy either the volume test or the time test. Businesses should be able to demonstrate that the reference price was genuine rather than created primarily to make a discount look larger.
The U.S. also prohibits deceptive pricing representations, including misleading former-price comparisons. The federal approach is not identical to Canada’s ordinary selling price tests, and state pricing and consumer protection laws may add further requirements.
Cross-border retailers should therefore keep reliable pricing records, including:
A pricing calendar built for one country should not automatically determine the claims used in the other.
Origin claims are a clear example of why packaging and advertising should be reviewed separately for each market.
For non-food goods, the Competition Bureau distinguishes between “Product of Canada” and “Made in Canada.”
The Bureau generally will not challenge a “Made in Canada” claim where:
For a “Product of Canada” claim, the Bureau generally looks for at least 98% of the total direct production or manufacturing costs to have been incurred in Canada, along with the last substantial transformation occurring in Canada.
The U.S. standard is different.
An unqualified “Made in USA” claim generally requires the product to be “all or virtually all” made in the United States. The FTC explains that this generally means final assembly or processing occurs in the U.S., significant processing occurs there, and all or virtually all ingredients or components are made and sourced in the United States.
The FTC’s Made in USA Labeling Rule specifically governs covered unqualified labels, while the FTC’s broader origin-claim policy and the FTC Act also apply to advertising representations.
A product that qualifies for particular Canadian origin wording does not automatically qualify for an equivalent U.S. claim.
Businesses should verify origin language before it appears on packaging, ecommerce listings, marketplace pages, paid advertising or promotional graphics.
A testimonial remains part of the advertisement even though someone outside the business appears to be speaking.
In Canada, section 74.02 of the Competition Act specifically regulates certain uses of third-party tests and testimonials. Where the provision applies, businesses should pay attention to written approval, permission to publish and whether the published representation accurately reflects what the third party approved.
A testimonial should not be edited in a way that changes its meaning or makes qualified results appear broader than they were.
Influencer marketing raises a related issue. Competition Bureau guidance states that influencers should clearly disclose material connections that could affect how consumers evaluate their independence from a brand.
Those connections can include:
The disclosure should be visible and understandable in the format in which the audience sees the content.
The United States has a separate framework. The FTC’s Endorsement Guides address endorsements, material connections and testimonial practices, while the federal Consumer Reviews and Testimonials Rule has applied since October 21, 2024.
The rule addresses practices including fake or false reviews and testimonials, certain undisclosed insider reviews, company-controlled review sites presented as independent, review suppression and incentives tied to particular positive or negative sentiment.
Businesses using the same influencer, testimonial or review campaign in both countries should therefore review more than the disclosure hashtag.
The company should know what the endorser is allowed to claim, what evidence supports those claims, how the relationship will be disclosed and whether the testimonial accurately reflects the person’s experience.
Using a customer quotation does not necessarily remove applicable substantiation requirements. Businesses should consider whether claims communicated through a testimonial require support in the same way as claims made directly by the business.
Claims such as “faster,” “more efficient,” “30% better than Brand X” or “number one” immediately raise another question: compared with what?
The business should define the comparison before publication.
Supporting records may need to identify:
The same principle applies to comparisons against the company’s own earlier products. A statement such as “now 25% faster” should be tied to a clear baseline.
A comparison can become misleading when the advertisement communicates a broader advantage than the evidence supports.
Not necessarily. If the main message creates a misleading impression, small print may not be enough to correct it. In Canada, the overall general impression of the advertisement matters. Competition Bureau compliance guidance cautions against relying on fine-print disclaimers where the advertisement as a whole creates a false or misleading impression.
U.S. disclosures also need to work in the context in which consumers actually encounter the claim.
Visibility matters. A disclosure that appears clearly on a desktop page may be difficult to find on mobile. A qualification placed after a “more” button in a social media caption may not be seen before the claim influences the customer. Video, audio, influencer and marketplace formats can require different disclosure treatment.
Draft the principal claim accurately first. Use the disclosure to explain genuine limits or conditions, not to repair an overstated headline.
| Claim area | Canada | United States |
| General advertising | The Competition Act prohibits materially false or misleading representations and considers both literal meaning and general impression. | The FTC Act prohibits unfair or deceptive advertising and addresses express and implied claims. |
| Performance claims | Certain performance, effectiveness and durability claims require an adequate and proper test conducted before the claim. | Objective claims generally require a reasonable basis before dissemination, with the necessary level of support depending on the claim. |
| Environmental claims | The Competition Act contains specific environmental-claim provisions as well as general misleading-advertising rules. | The FTC Act applies, and the Green Guides provide guidance on the interpretation, qualification and substantiation of environmental claims. |
| Regular and sale pricing | Specific ordinary selling price volume and time tests can apply. | Federal deceptive-pricing principles apply, and additional state requirements may also be relevant. |
| Origin claims | “Made in Canada” and “Product of Canada” are assessed using distinct Canadian content and substantial-transformation criteria. | Unqualified “Made in USA” claims generally require the product to be “all or virtually all” made in the United States. The Labeling Rule specifically governs covered labels. |
| Testimonials | The Competition Act contains specific provisions governing certain tests and testimonials. | The FTC Act, Endorsement Guides and Consumer Reviews and Testimonials Rule may apply. |
| Influencers | Material connections should be clearly disclosed under Competition Bureau guidance. | Material connections should be clearly disclosed under FTC endorsement principles. |
This comparison is a starting point. Provincial, state and sector-specific requirements may add further obligations.
Advertising review is easier when substantiation is collected before a campaign reaches final approval.
Depending on the claim, an evidence file may include:
The documentation should support the claim actually being published.
If the evidence supports “uses less energy,” it does not automatically support “the most energy-efficient option.” A late copy change can create a new claim that requires a different level of proof.
Advertising evidence often sits across several departments.
Product teams may hold performance testing. Sales may control pricing history. Procurement may know where components were sourced. Sustainability teams may maintain environmental information. Marketing turns those facts into the final message.
A workable review process brings those records together before publication.
Higher-risk claims can then be identified early and routed for the right level of review. That does not mean every social media post requires the same legal process. It means the business knows when a statement about performance, savings, environmental benefits, origin, testimonials or competitors deserves additional scrutiny.
For cross-border campaigns, the process should also identify when the Canadian and U.S. versions need different wording.
Before publishing a campaign in Canada and the United States, confirm:
Advertising compliance does not require businesses to avoid useful or persuasive claims. Objective claims should be framed so they are appropriately supported by the available evidence and meet the applicable legal standard.
If a product performs better, the business should know what testing supports that statement. If an advertisement promises savings, the reference price should be genuine. If packaging claims Canadian or American origin, sourcing and manufacturing records should support the exact wording. If a campaign relies on testimonials, endorsements or environmental benefits, the company should understand what those messages communicate to customers.
For businesses operating on both sides of the border, the additional step is recognizing that compliance in one country does not automatically establish compliance in the other.
Planning a campaign that will run in Canada and the United States? Pace Law Firm’s Corporate Commercial team can review advertising claims, substantiation, promotional terms, endorsements and campaign language against the legal requirements that may apply in each market.
No. Both countries prohibit deceptive advertising and expect factual claims to be supportable, but the legal tests are not identical. Performance claims, environmental statements, sale pricing, origin claims, testimonials, reviews and endorsements can be treated differently.
Objective advertising claims should generally be supported before publication. In Canada, certain performance claims require an adequate and proper test conducted before the claim is made. In the United States, the FTC generally requires advertisers to possess a reasonable basis for objective claims before dissemination.
Canada’s Competition Act contains specific environmental-claim provisions as well as general prohibitions against materially false or misleading advertising. In the United States, the FTC Act applies and the Green Guides provide guidance on environmental claims. Businesses should make specific claims that can be supported with appropriate evidence.
Businesses should be careful. Canada has specific ordinary selling price rules based on volume and time tests. U.S. law also prohibits deceptive former-price advertising, and additional state requirements may apply.
They can be. Testimonials should be genuine and accurately presented, and material relationships between endorsers and businesses should be clearly disclosed. Canada also has specific Competition Act provisions governing certain testimonials and tests, while the United States has FTC endorsement guidance and the Consumer Reviews and Testimonials Rule.
The standards are different. Canadian guidance uses specific domestic-cost thresholds, substantial-transformation requirements and, for “Made in Canada,” appropriate qualification. An unqualified “Made in USA” claim generally requires the product to be all or virtually all made in the United States.
Not necessarily. A qualification should clarify an otherwise accurate claim. If the headline, image, pricing presentation or advertisement as a whole creates a misleading impression, a small or difficult-to-find disclaimer may not correct it.
Not automatically. Businesses can use the same underlying campaign concept, but claims involving performance, pricing, environmental benefits, origin, testimonials, reviews, endorsements and disclosures should be checked against the rules that apply in each market.
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191 The West Mall, Suite 1100
Toronto, ON M9C 5K8
Phone: 1-877-236-3060
Fax: 416-236-1809