Navigating Legal Changes: How British Columbia's BPCPA Amendments Impact Businesses and Protect Consumers
Business owners operating in British Columbia, must be aware of the Business Practices and Consumer Protection Act (BPCPA), established in 2004 to ensure fair dealings between businesses and consumers. On February 25, 2025, Bill 4 was introduced, proposing significant changes to the BPCPA. If enacted, Bill 4 will impact businesses and require them to amend their consumer contracts and customer services policies. What follows is an exploration of what Bill 4 could mean for businesses.
What are some of the proposed changes?
Enhanced Disclosure Requirements:
Businesses will be required to proactively provide disclosure in consumer contracts, also for online orders, including detailed information on pricing, the nature of the goods and services, technical specifications, payment terms, total cost, trade-in or credit details of any security interest, delivery arrangements, supply date if different from the date the contract is entered into, renewals, returns, cancellation rights, refunds, and renewal terms, and rights of cancellation. The supplier must provide, at the time the information is disclosed, an express opportunity to review the contract and provide a copy to the consumer if requested.
Consumers may cancel a contract if the required information is missing, inconsistent with prior disclosures, or if the supplier fails to comply with the required disclosure.
Subscription Contracts:
The Bill introduces amendments to subscription contracts, voiding automatic renewal for terms of 60 days or less, unless consumers can cancel at any time without penalties or charges. Their cancellation rights must be clearly described. For agreements exceeding 60 days, businesses must allow consumers to cancel at any time without charges or penalties before the renewal date; if after the renewal date, then the consumer is entitled to a refund. In any case, the supplier must give notice of the renewal “not more than 60 days and not less than 30 days before the renewal date,” with a statement of the consumer’s right under the contract to cancel the renewal and a statement advising that the renewal will proceed if the consumer does not respond to the notice. The business must be able to prove that the notice was received by the consumer.
Consent for Contract Changes:
Any amendments to existing contracts will require explicit consent from consumers, meaning businesses cannot unilaterally modify terms, in a way that increases consumer’s obligation or decreases the business’ obligations. Subject to certain limited exceptions, such as an amendment solely for the benefit of the consumer, the provisions of the contract that may be unilaterally amended must be identified in the contract at the time the contract is entered into. Even in such cases where the amendment solely benefits the consumer and it was clearly identified in the contract at the time it was entered into, the supplier must “not less than 30 days and not more than 60 days” before the provision is to take effect, provide notice to the consumer in a way that allows the supplier to prove that the consumer has received the notice, together with the text of the provision, an explanation of the amendment, and cancellation policy, according to Section 25.2(3) of the Act.
If the supplier fails to comply with this section, the amendment is void. If the amendment increases an obligation of the consumer or reduces an obligation of the supplier under a contract, the consumer may cancel the contract without charge or penalty.
Class Action Lawsuit Participation and Arbitration:
Businesses may not include clauses that prevent consumers from joining class action lawsuits or that force them into private arbitration. This would also apply to business-to-business contracts if the dispute involves a “low value claim,” as defined by the regulation. Any such terms would be void. The amendments also allow consumers to seek damages for contraventions of the BPCPA at the Civil Resolution Tribunal.
Reviews:
Contractual terms restricting the posting or communication of reviews of the goods, services, or the transaction are prohibited.
Direct Sales of High-Cost Goods:
Under Bill 4, direct sales of high-cost household goods, including furnaces, air conditioners, duct cleaning services, air cleaners or purifiers, water heaters, water treatment devices, purifiers or filters, water softeners, window or energy audits, and home security systems are prohibited. A supplier must not extend, offer, or arrange credit in respect of a direct sales contract.
If a direct sales contract for such products is entered into, the customer is entitled to a full refund.
Understanding Retroactive Application
Bill 4 proposes to have a retroactive application of certain provisions. This means that arbitration clauses or class action waivers in existing contracts will be void, thus allowing customers to initiate litigation proceedings that were not possible before. Specifically, the ban on mandatory arbitration clauses and class action waivers will apply to contracts signed before Bill 4 was enacted.
Potential Challenges and Solutions
Navigating compliance while maintaining operational efficiency can be challenging. Here are some common challenges and potential solutions:
- Increased Administrative Burden: Updating contracts and managing consumer disclosures may require more administrative work. Consider investing in automated systems or software to streamline these processes and reduce manual labour.
- Risk of Litigation: Business owners will need to prepare for a higher risk of litigation. With arbitration clauses or class action waivers prohibited, and the retroactive nature of the amendments, there may be an increase in lawsuits as consumers choose to take legal action. It is advisable to proactively explore alternative dispute resolution methods, such as mediation or voluntary arbitration when a conflict shows signs of escalating into litigation.
- Operational Efficiency: Striking a balance between compliance and operational efficiency is crucial. You can integrate compliance checks into your existing workflows, use technology to monitor compliance, and continuously review your processes for improvement.
CONCLUSION
In this article, we discussed some of the proposed amendments to Bill 4 and their potential effects on businesses and consumers in British Columbia. Key points include:
- Expanded disclosure requirements
- Prohibition of mandatory arbitration clauses and class action waivers
- New rules for subscription contracts
- Retroactive application of some amendments
While these amendments introduce new compliance requirements and create complex challenges for businesses operating in the province, they also provide significant benefits for consumers, such as improved transparency, access to justice, and protection from unfair practices.
To adapt, businesses should:
- Choose their legal support team
- Review and update contracts
- Implement new policies
- Explore alternative dispute resolution options
By counting on the services of a legal team, prioritizing compliance and staying informed, businesses can navigate the changing legal landscape and strengthen relationships with their customers.
Call to Action
We encourage businesses to take the initiative and seek legal consultations, update contract templates, and train staff on the new regulations.
We are at your service for all your legal questions at 250-381-4040.
Additional Resources
Bill 4 – 2025: Business Practices and Consumer Protection Amendment Act, 2025
